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Technical  and  Bibliographic  Notas/Notes  techniques  et  bibllographiques 


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1 

2 

3 

4 

5 

6 

•>■•■■■ 


W'. 


■i    t^ 


TH 


v.  8. 


HAMPERS 

Half-Houi^  Series. 


v-/ 


? 

^ 


THE  A  B  C  OF  FINANCE. 


By  SIMON  KEWCOMB,  LL.D., 

V.  8.  HAVAb  OMBtTATORT,  WAMUIWTOW,  a  0. ;  AOTWIR  OP 

"ropoLiB  AmumoKT." 


Copjrr^l,  1877,  bjr  UABrKB  k  BmTnxBS. 


-i.a*^~. 


■iU' 


n 


EiMR'SEALF-EODRSEBIES. 


1.  THE  TURKS  IN  EUROPE.  By  Edwakd 
A.  Freeman.     16  cents. 

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Hon.E.H.KNATCHBULL-HDaEa3EN,M.P.    20ct8. 

EPOCHS  OF  ENGLISH  HISTORY,  a  Se- 
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land  at  Successive  Epochs.  Edited  by  the  Rev. 
H.  Crbighton,  M.A.,  late  Fellow  and  Tutor  of 
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man  Conquest  By  Frederick  Yore> 
Powell.    With  Four  Maps.    26  cents. 


Harpers  Half- Hour  StrUt. 


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WAN  AND  EUROPEAN  WARS, 
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li.A.    (/« Preparaiim.) 


TORY— Con. 

TINENTAL 
est  to  Magna 

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S>',  and  Growth 

reat  Charter  to 

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W  THE  COK- 
J  to  1778.  By 
\  Preparation.) 

THE  AMER- 
'EAN  WARSy 
0.  W.  Tascock, 


4 


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\F  THE  REV. 
iE  Eliot.       23 

STORY.      By 

E.    By  OioiusE 

EUS,  New  Tork. 

Iff  pripald,  (0  M|f  f<ir( 
U  priei. 


ABC  OF  FINANCE; 


THE   MONEY    AND   LABOR   QUESTIONS 
FAMILIARLY  EXPLAINED  TO  COM- 
MON PEOPLE,  IN  SHORT  AND 
EASY  LESSONS. 


Bv  SmON  ^fEWCOMB,  LL.D., 


r.  I.  NAVAL  OBSIRVATORT,  WAIRIKOTOK,  D,  0. ;  ACTCOS 
or  "rOPOLAR  ASTROROHT." 


AC/ 

■Hz 


(its, 


Bnlmd  MMidlac  to  Aet  of  Congnw.  *■>  <>»  7""  >*'7i  *>T 

lUircR  ft  DioTiiins, 
la  Ibt  OfflM  oflk*  Ubcwtamif  ConccMt,  •!  WuUafloD. 


M      K7 


PREFACE. 


'■"-•to 


)  jTMr  1177,  bj 
I  WuUafloD. 


A  PART  of  those  "lessons"  appeared 
some  time  since  in  Harper't  Weekly. 
TIio  unexpected  favor  with  which  they 
were  received,  by  being  reprinted,  in  whole 
or  in  part,  by  newspapers  -in  varions  sec- 
tions of  the  country,  has  suggested  their 
reproduction  in  a  more  permanent  form. 
They  are  now  completed,  by  the  addition 
of  several  chapters  bearing  on  the  labor 
questions  of  the  present  day. 


I 


CONTENTS. 


UMOH  rioa 

I.  What  Society  does  for  the  Laborer. .     18 

II.  Capital  and  Labor 19 

III.  Starvation  Wages 29 

rV.  One  Dollar. Z1 

V.  Value  cannot  bo  given  by  Govern- 
ment      41 

VL  The  Value  of  Paper  Money 45 

VIL  Why  has  the  Greenback  any  Value  ? .     S2 

Vin.  The  3.66.Bond  Plan 67" 

IX.  The  Mystery  of  Money 63 

X.  The  Evil  of  a  Depredating  Currency.     6S 

XI.  A  Few  Facts 16 

Xn.  The  Lessons  of  History 79 

XIIL  The  Public  Faith 95 

XIV.  The  Cause  and  the  Remedy. 108 

XV.  Some  General  Thoughts Ill 


i 


'W^ 


THE 

ABC    OF   FINANCE; 

OK, 

THE  UONET  AND  LABOB  QUESTIONS  FAMIIr 

lARLT  EXPLAINED  TO  COMMON 

PEOPLE,  IN  SHORT  AND 

EAST  LESSON& 


No  doubt  the  reader  thinks  he  knows 
nothhig  about  the  money  and  labor  ques- 
tions, and  that  they  are  quite  beyond  his 
understanding.  If  he  has  ever  tried  to 
learn  anything,  he  has  been  so  bewildered 
by  opposing  theories  and  opposing  asser- 
tions  as  to  feel  that  he  knew  less  than  be 
did  before.  He  is,  therefore,  quite  ready 
to  leave  these  questions  to  the  politicians, 
and  to  vote  on  them  as  they  think  best 


12 


TIIK  ABC  OF  FINANCE. 


This  ought  not  to  be.  Of  course  there 
are  many  profound  financial  principles 
which  cannot  be  fully  seen  through  with- 
out careful  study,  but  in  the  issues  now 
before  the  people  only  the  A  B  C  of  the 
subject  is  involved.  To  understand  them 
one  only  needs  arithmetic  enough  to  keep 
an  account  of  the  money  he  receives  and 
spends,  and  common-sense  enough  not  to 
buy  a  lottery  ticket  because  just  the  very 
pidr  of  trotting  horses  he  wants  are  to  be 
drawn  in  the  lottery.  The  difficulty  has 
been  that  writers  and  speakers  dive  so 
deeply  into  the  principles  of  constitutional 
law  and  the  functions  of  government  that 
plain  people  cannot  jclearly  follow  them; 
and  thus  the  said  people  arc  in  the  best 
state  of  mind  to  become  the  dupes  of  wild 
theorists  and  scheming  politicians.  It  is 
the  duty  of  every  man  to  study  subjects  in 
which  his  own  interests  and  those  of  the 
community  are  so  deeply  involved  with  all 
posuble  calmness,  and  without  prejadice, 
that  he  may  be  able  to  give  some  good 
reason  for  the  fidth  that  is  in  him.  The 
writer  proposes,  in  this  little  book,  not  to 


fCB. 

r  course  there 
ial  principles 
:1irough  with- 
0  issues  now 
ABC  of  the 
icrstand  them 
ough  to  keep 
receives  and 
nough  not  to 
just  the  very 
tnts  are  to  be 
difficulty  has 
ikcrs  dive  so 
coustitutional 
remmcnt  that 
follow  them; 
:c  in  the  best 
dupes  of  wild 
ticians.  It  is 
dy  subjects  in 
i  those  of  the 
olved  with  all 
Dut  pn^jadioe, 
re  some  good 
in  him.  The 
i  book,  not  to 


WHAT  SOCIETY  DOES  VOK  THE  LABORKR.  13 

write  a  treatise  on  the  subject,  but  only  to 
suggest  seme  thoughts  which  may  be  part- 
ly new  to  the  reader,  and  which,  if  he  turns 
them  carefully  over  in  his  mind,  will  en- 
able him  to  form  an  intelligent  judgment 
upon  the  issues  now  presented  to  him. 


LESSON  I. 

WHAT  BOCIETT  DOES  FOR  THE  LABOBEB. 

I  SHALL  suppose  myself  speaking  to  some 
one  who  sympathizes  with  "  labor  move- 
ments" of  the  day,  trades -unions,  strikes, 
and  so  on,  who  thinks  that  capital  is  in 
some  way  at  enmity  with  labor,  and  who 
believes  in  general  that  the  laborer  does 
not  get  his  right  share  of  the  good  things 
which  he  helps  to  produce.  To  one  who 
thinks  thus  I  wish  to  suggest  a  few  new 
thoughts. 

Whence  came  the  shoes  on  your  feett 
The  leather  of  which  they  are  made  came 
all  the  way  from  the  plams  of  Texas;  the 
hides  were  tanned  with  bark  cut  down  by 


14 


THE  ABO  OF  FINAKCB. 


hardy  wood-choppers  hundreds,  and  per- 
haps thousands,  of  miles  from  where  you 
live.  The  thread  -with  which  they  are 
sewed  has  required  the  combined  labor  of 
farmers  in  Ireland  or  planters  in  the  South 
to  raise  the  flax  and  cotton,  and  of  wood- 
choppers  in  North  Carolina  to  raise  the 
material  for  the  wax  with  which  the  thread 
is  strengthened.  Drovers  in  Texas,  tan- 
ners in  Tennessee,  wood -choppers  in  the 
West,  manufacturers  without  number,  with 
more  ingenious  machinery  than  either  yon 
or  I  can  pretend  to  describe,  ore  all  busy 
in  getting  up  material  for  the  shoes  which 
you  and  your  children  are  to  wear  two 
years  hence,  while  railroad  men  are  plan- 
ning railroads,  freight-cars,  and  engines  for 
bringing  the  materials  within  reach  of  yon 
and  your  shoemaker. 

If  so  much  is  true  of  so  small  an  article 
as  the  shoe  on  your  foot,  how  is  it  with 
every  other  article  which  surrounds  you  ? 
Think  of  your  various  articles  of  clothing. 
However  poor  and  insignificant  you  may 
be,  you  and  your  family  are  sheltered  by 
■ome  kind  of  a  roof;  and  if  you  will  climb 


'^aan 


rcB. 


WHAT  BOCIBTY  DOES  FOR  TUB  LABOREIl.  15 


eds,  and  per- 
m  where  you 
ich  they  are 
lined  labor  of 
I  in  the  South 
and  of  wood- 
to  raise  the 
icb  the  thread 
a  Texas,  tan- 
oppcrs  in  the 
number,  with 
lan  either  you 
i,  ore  all  busy 

0  shoes  which 
to  wear  tw^o 

men  are  plan- 
ad  engines  for 

1  reach  of  yon 

uall  an  article 
ow  is  it  with 
irrounds  you? 
B8  of  clothing, 
cant  you  may 
I  sheltered  by 
poa  will  climb 


up  and  examine  all  the  materials  of  which 
that  roof  is  made,  and  then  learu  where 
these  materials  came  from,  you  will  find 
that  the  labor  of  scores,  nay,  perhaps  hun- 
dreds, of  people — from  the  miners  of  Corn- 
wall and  the  ship-builders  of  Maine  to  the 
house-carpenters  who  are  your  neighbors- 
has  been  called  on  to  shelter  you  from  the 
weather.  If  you  are  sick,  you  are  supplied 
with  medicine  in  the  manufacture  of  which 
the  skill  of  the  great  chemists  of  the  world 
has  been  applied ;  and  you  never  saw  an  in- 
dustrious man  so  poor  but  that  in  a  severe 
case  be  could  atail  himself  of  the  services 
of  a  doctor  in  whose  education  the  experii 
ence  of  whole  generations  of  physicians  had 
been  drawn  upon.  The  very  aeu  who  com- 
plain most  loudly  of  the  oppression  of  la- 
bor are  now  in  most  respects  better  taken 
care  of  when  sick  than  kings  were  a  thou- 
sand years  ago. 

You  see  that  the  poorest  laborer  in  the 
land  has  his  wants  ministered  to  by  thou- 
sands of  his  fellow:-men,  scattered  through- 
out the  wide  world,  and  separated  by  oceans 
the  crossing  of  which  is  a  marvel  of  huoaan 


mtino' 


IG 


TIIK  ABC  OF  FIMAKCR. 


skill.  How  is  such  a  result  possible  t  It 
is  by  a  system  of  social  macbincry,  if  I 
may  use  the  expression,  more  wonderflil 
and  effective  than  any  that  the  wildest 
communists  erer  dreamed  of.  In  their  ideal 
system,  every  man  works  for  his  neighbors 
of  the  community;  but  in  the  actual  sys- 
tem, we  may  almost  say  that  the  whole 
world  is  working  for  every  one  else.  Do 
you  think  there  is  going  to  be  any  great  im- 
provement made  in  the  system  which  pro- 
duces such  results  t  No  sudden  one,  C3i^ 
tainly.  I  am  so  much  afraid  of  its  being  in- 
jured by  tinkering  that  I  am  willing  to  suf- 
fer anything  rather  than  see  men  try  to  pull 
it  to  pieces  in  order  to  make  it  go  better. 

Every  man  who  expects  to  make  an  hon- 
est living  has  an  interest  in  keeping  this 
social  machinery  in  good  working  order. 
But  there  is  something  else  in  which  he 
has  a  still  higher  interest,  because  without 
it  the  machine  itself  would  cease  to  go,  and 
the  laborer  would  become  a  slave.  That 
something  is.  law  and  order  and  the  right 
of  property.  Complaining  people  some- 
tunes  say  that,  the  laborer  is  no  better  off 


I  WUA 


than 

a  mil 

tion; 

refht 

prcsc 

only 

the 

clotl 

breai 

woul 

cent 

But 

bore 

servi 

to  a 

war, 

pva( 

adv( 

as  il 

of  e 

desi 

he( 

low 

step 

lose 

free 


sai 


potMiblo  f  It 
ncliincry,  if  I 
)re  wonderfViI 
t  tho  wildest 

In  their  ideal 
liifl  neiglibora 
be  actual  sys- 
lat  tlie  whole 
one  else.  Do 
!  any  great  im- 
;m  which  pro- 
Idcn  one,  C3r- 
Df  its  being  in- 
willing  to  BUf- 
nen  try  to  pull 
it  go  better, 
make  an  hon- 
1  keeping  this 
rorking  order. 
I  in  which  he 
!cau8e  without 
;a8e  to  go,  and 
I  slave.    That 

and  the  right 

people  Bome- 
I  no  better  off 


WHAT  SOCIETY  DDKS  FOB  TUB  LA.DOBBB.  17 

than  he  was  centuries  ago.    So  unblushing 
a  misstatement  is  hardly  worthy  of  refuta- 
tion ;  but  we  may  take  a  look  back,  not  to 
refiite  it,  but  to  see  what  the  laborer  of  the 
present  day  owes  to  civilization.    Could  I 
only  paint  you  a  picture  of  tho  laborer  in 
the  time  of  William  the  Conqueror,  the 
clothes  ho  wore,  the  food  he  ate,  the  air  he 
breathed,  tho  hut  he  lived  in,  I  think  you 
would  accept  all  the  evils  of  the  nineteenth 
century  without  one  word  of  complaint 
But  tho  point  I  now  make  is,  thot  the  la- 
borer was  not  then  his  own  master,  but  his 
services,  and  those  of  his  children,  belonged 
to  a  lord  whoso  battles  he  had  to  fight  in 
war,  and  whose  grounds  he  had  to  till  in 
peace.    Wliy  is  it  not  so  now?    Because 
advancing  civilization,  with  philosophers 
as  its  mouth-pieces,  proclaimed  the  rights 
of  each  man  to  be  tho  master  of  his  own 
destiny,  and  the  owner  of  all  property  which 
he  could  gain  by  fair  bargains  with  bis  fel- 
low-men, while  law  and  good  government 
stepped  in  to  enforce  the  principles  of  phi- 
losophy.   From  the  right  of  free  labor  and 
free  bargaining,  thus  enforced  by  law,  arose 


18 


TUB  ADC  OF  FIXAMCK. 


tbe  wonderftil  social  machine  which  now 
places  in  every  man's  hands  his  share  of  the 
work  of  the  world. 

I  now  want  you  to  think  of  just  a  single 
application  of  the  great  principle  just  enun- 
ciated. Tbe  same  law  which  gives  the 
workmen  of  a  railroad  the  right  to  leave  it 
when  they  are  dissatisfied  with  their  wages 
gives  the  owners  of  the  railroad  the  right 
to  employ  whom  they  please  to  run  it ;  and 
if  you  abolish  this  law,  you  will  soon  find 
that  it  will  bo  the  laborers,  and  not  the 
railroad  owners,  who  will  sufler.  They  will 
belong  to  the  railroad  before  the  road  will 
belong  to  them.  No  matter  how  much  they 
may  moke  others  suffer,  they  will  suffer 
more  themselves.  Thus,  when  men  forcibly 
interfere  with  the  running  of  the  trains  bo- 
cause  they  are  not  satisfied  with  the  men 
whom  the  companies  employ  to  ran  them, 
they  violate  the  fundamental  law  to  which 
they  owe  their  finedom  and  the  advantages 
which  they  ei\}oy,  and  take  the  most  vigor- 
ous steps  they  are  able  to  throw  themselvea 
into  tbe  condition  of  the  laborer  of  past 
ages. 


SM 


■"P" 


NCK. 

le  which  now 
lis  sharo  of  th« 

)f  just  a  singlo 
;iplcju8tenun- 
ich  gives  the 
ght  tu  leave  it 
th  their  wages 
road  the  right 
tu  run  it ;  and 
will  soon  find 
1,  and  not  the 
Fer.  They  will 
3  the  road  will 
low  much  they 
ley  will  Buficr 
in  men  forcibly 
f  the  trains  be- 
with  the  men 
y  to  ran  them, 
1  law  to  which 
the  advantages 
the  most  vigor- 
row  themselves 
aborer  of  past 


CAPITAL  AND  LABOR.  19 


LESSON  II. 

CAPrrAL  AKD  LABOR. 

We  frequently  hear  of  the  oppression  of 
labor  by  capital,  and  of  antagonism  be- 
tween these  two  agencies.  In  order  to 
judge  how  much  foundation  there  is  for 
this  notion,  let  us  inquire  what  capital  re- 
ally is.  It  seems  as  if  a  large  irartion  of 
the  labor  party  look  upon  it  as  some  kind 
of  instrumentality  wielded  by  the  rich  for 
the  purpose  of  injuring  or  oppressing 
the  poor.  Really,  however,  capital  consists 
simply  of  the  accumulated  wealth  of  the 
past — bouses,  machinery,  railroads,  engines, 
mills,  and  everything  which  in  any  way 
produces  the  things  that  we  want  It  is 
one  of  the  most  important  parts  of  the  so- 
cial machine  described  in  my  last  lesson. 
I  might  say,  indeed,  that  it  is  the  whole 
material  part  of  that  machine.  The  ships 
which  bring  flannel  shirts  across  the  ocean 
for  you  to  wear  in  winter ;  the  factories  in 
which  those  shirts  were  made;  the  rail- 


M 


TUB  ADC  or  FIXANCE. 


: 


ways  which  transport  them  to  your  city; 
tho  warehouses  in  which  they  are  stored 
until  you  are  ready  to  buy  them ;  the  roof 
which  covers  your  head,  and  all  tlio  ma- 
chinery designed  for  the  transportation  and 
preservation  of  tho  food  you  cat,  are  capi- 
tal. To  complain  of  these  when  one  is 
suffering  for  the  comforts  of  life  is  as  if  a 
naked  and  hungry  man  should  complain 
tliat  food  and  clothing  were  his  enemies. 
Diminish  or  ii\jure  this  capital,  and  tho 
power  of  everylMKly,  tho  laborer  included, 
to  get  clothes  to  wear,  food  to  eat,  and  shel- 
ter fVom  tho  weather,  will  be  diminished. 

Let  us  now  go  a  step  fbrthcr.  Food, 
clothing,  and  shelter  are  tho  three  great 
wants  for  which  we  all  labor.  To  supply 
these  wants  in  the  best  manner,  both  tho 
labor  and  capital  of  others  are  necessary. 
For  instance,  taking  all  the  people  of  tho 
country  together,  tbey  need,  we  may  sup- 
pose, some  throe  millions  of  houses  to  live 
in.  These  houses  must  be  kept  in  repair ; 
and,  as  population  increases,  a  hundred 
thousand  new  ones  must  bo  built  every 
year  to  accommodate  our  increasing  num- 


fn8Qwrs*««*wf(H"9««HtMr- 


WOE. 

to  your  city; 
ley  are  ttorcd 
lom ;  tlio  roof 
d  all  tfio  nin- 
iportution  and 
I  eat,  are  capi- 
whon  one  is 
'  life  is  as  if  n 
>uld  complain 
B  his  enemies, 
pital,  and  the 
nrcr  included, 
}  eat,  and  shel- 
diminishod. 
irthcr.  Pood, 
10  three  great 
r.  To  supply 
nner,  both  the 
are  necessary, 
people  of  the 
,  we  may  sup- 
houses  to  live 
:ept  in  repair ; 
18,  a  hundred 
«  built  every 
creasing  num- 


CAPITAL  ASU  LABOR. 


31 


bcrs.'  The  more  labor  which  is  ptlt  Into 
buildings  and  repairs,  the  more  perfectly 
will  evcrybmly,  laborers  included,  bo  shel- 
tered.   8o,  if  the  hou8e-carpout<!rB  all  strike, 
or  in  any  way  prevent  house  building  and 
repairing  tcom  going  on,  there  will  be  few- 
er and  poorer  houses  to  shelter  the  popu- 
lation, and  some  one  must  go  with  less  per- 
fect shelter  than  he  would  otherwise  en- 
joy.   Perhaps  you  will  think  thot  in  this 
case  the  loss  would  fall  principally  upon 
the  rich,  and  that  it  would  Ik;  the  rich  who 
would  have  to  live  in  staaller  or  worse 
hou8C^  rather  than  the  poor.    But  the  fact 
is  directly  the  contrary.    The  rich  man  is 
oble  to  have  just  such  a  house  as  he  wants, 
and  will  have  it  without  regard  to  the 
wages  of  carpenters ;  so  that  whatever  suf- 
fering may  result  from  the  houses  not  be- 
ing built,  or  enlarged,  or  repaired,  has  to 
be  undergone  by  the  laboring  and  the  poor- 
er classes,  and  not  by  the  rich. 

The  same  thing  holds  true  of  every  arti- 
cle of  food  and  shelter  of  which  the  labor- 
ing classes  are  so  much  in  need.  Let  us 
take  some  examples.    In  the  recent  riot  in 


THK  ABC  OF  FINAKCS. 


i 


Pittsburgh,  an  immense  quantity  of  coal  oil 
was  destroyed  by  the  rioters.  The  means 
of  lighting  the  houses  of  our  country  were 
diminished  by  the  quantity  of  oil  thus  de- 
stroyed. There  is  less  oil  in  the  market, 
and,  in  consequence  of  the  destruction,  a 
somewhat  higher  price  must  be  paid  for 
ever;  gallon  that  is  left.  On  whom  do 
you  think  the  loss  will  fall  ?  On  tte  rich  ? 
Not  at  all.  They  do  not  bum  coal  oil,  and 
if  they  did,  they  would  have  their  houses 
well  lighted,  no  matter  if  they  do  have  to 
pay  a  few  cents  a  gallon  more.  It  is  the 
people  with  whom  one  cent  a  gallon  is  an 
important  item  who  must  economize  in  us- 
ing the  oil,  and  strain  their  eyes  for  want 
of  good  light ;  so  that  they  are  the  real 
class  who  must  suffer  by  the  burning  of 
the  oil. 

During  the  reign  of  the  Paris  Commune 
the  CTommunists  burned  three  or  four 
houses  belonging  to  M.  Thiers,  a  man  of 
great  wealth.  Did  they  damage  his  shel- 
ter! Not  in  the  least.  No  matter  how 
many  houses  he  owned,  he  could  only  live 
in  one.    Tae  people  whose  shelter  was  di- 


sat. 

itity  of  coal  oil 
The  means 

country  were 
>f  oil  thus  dc- 
n  the  market, 
destruction,  a 
t  be  paid  for 
On  whom  do 

On  the  rich  ? 
a  coal  oil,  and 

their  houses 
ey  do  have  to 
>re.  It  is  the 
a  gallon  is  an 
tnomize  in  us- 
eyes  for  want 
T  are  the  real 
te  burning  of 

uis  Commune 
bree  or  four 
en,  a  man  of 
nage  his  sheN 
)  matter  how 
raid  only  live 
helter  was  di- 


.  CAPrrAL  AND  LABOB.  '* 

mlMshed  by  this  destruction  were  not  M. 
Thiers  or  his  family,  but  the  tenants  who 
had  to  rent  houses  from  him.  If  there 
were  ten  houses  less  in  Paris,  it  was  inev- 
itable that  the  people  must  have  lived  in 
fewer  houses  than  before. 

In  the  Pittsburgh  riot  of  which  I  have 
spoken,  several  hundred  thousand  bushels 
of  wheat  were  burned.  Somebody's  sup- 
ply of  bread  must  be  diminished  by  that 
movement.  Whose  will  it  be?  That  of 
the  rich?  Not  in  the  slightest.  They  will 
have  their  full  supply,  no  matter  what  it 
costs.  Those  who  will  suffer  will  be  the 
poor,  who  will  have  to  give  higher  prices 
in  consequence  of  the  destruction  of  the 
wheat  If  the  ferm  laborers  should  strike 
for  higher  wages,  and  thus  diminish  the 
supply  and  raise  the  price  of  grain,  the  re- 
sult would  be  the  same.  It  would  be  their 
fellow-laborers  of  the  whole  country  who 
would  have  to  pay  the  cost 

I  hope  you  will  now  be  able  to  see  that 
•11  accumulated  capital  is  for  the  advan- 
tage of  the  laborer  or  the  non-capitalist, 
M  well  as  the  rich.    If  the  capitaliat  ex- 


i  I 


-y 


•  ~_:  ^-rffllrSV 


■  ; 


.*  THE  ABC  OF  FINANCE. 

pends  his  money  in  building  a  factory,  that 
factory  is  making  clothing  for  the  poor  as 
well  as  for  the  rich;  probably  more  for  the 
poor  than  for  the  rich,  because  the  former 
will  derive  the  greatest  advantages  from  the 
cheapening  of  clothing  thus  produced.    If 
he  builds  a  railroad  with  it,  that  railroad 
will  be  employed  in  bringing  hides  from 
Texas  to  make  shoes  for  the  laborer's  feet, 
or  com  from  Illinois  for  him  to  consume. 
The  capitalist  may  or  may  not  derive  any 
benefit  from  it ;  but  it  is  certain  that  the 
laborer  will  derive  a  benefit.    If  the  capi- 
talist builds  a  row  of  houses,  the  only  use 
he  can  make  of  them  is  to  get  somebody  to 
live  in  them.    Tlie  amount  of  shelter  that 
is  available  fojr  laborers  is  thus  increased, 
ond  they  have  just  as  much  advantage  of 
the  houses  while  they  live  in  them  as  if 
they  owned  them  themselves ;  that  is  to 
say,  as  far  as  shelter  is  concerned,  the  house 
you  live  in  is  equally  useful  to  you  wheth- 
er you  own  it  or  some  one  else  owns  it. 
But  you  say,  perhaps, "  The  owner  takes  a 
tax  from  me  in  the  shape  of  rent  for  Uving 
is  it.^'    This  is  true,  and  in  the  market  this 


s^ 


NCE. 

a  factory,  that 
or  the  poor  as 
y  more  for  the 
ise  the  former 
itages  from  the 
produced.    If 
I  that  railroad 
ig  hides  from 
laborer's  feet, 
t  to  consume, 
ot  derive  any 
rtain  that  the 
If  the  capi- 
,  the  only  use 
;  somebody  to 
)f  shelter  that 
lus  increased, 
advantage  of 
n  them  as  if 
s;  that  is  to 
led,  the  house 
o  you  wheth- 
else  owns  it. 
wner  takes  a 
ent  for  b'ving 
e  market  this. 


CAPITAL  AKD  LABOB. 


S5 


rent  is  the  equivalent  of  the  shelter ;  but 
it  would  not  be  the  equivalent  of  the  shel- 
ter if  there  were  no  capital  to  build  houses 
at  all.  For  every  house  which  is  burned 
down,  and  every  house  which  is  not  built, 
the  rent  of  the  remaining  ones  is  higher, 
while  for  every  new  house  added  the  rent 
comes  lower.  However  rents  may  vary,  it 
is  certain  that  if  the  number  of  houses  is 
duninished  from  any  cause  whatever,  there 
must  be  more  people  in  one  house,  and 
thus  more  discomfort. 

Again,  what  does  the  capitalist  do  with 
the  money  which  you  pay  him  for  rent! 
Some  part  of  it  he  may  expend  for  his  own 
exclusive  benefit;  but,  as  the  world  goes, 
the  chances  are  that  he  puts  ilie  larger  part 
of  it  into  improvements  which  in  some  way 
benefit  his  fellow -men,  laborers  included. 
Some  part  of  it  goes  to  keep  the  very  house 
in  which  you  live  in  repair;  another  part, 
perhaps,  to  build  new  houses ;  another  part 
to  extend  railroads,  and  so  on.  In  all  these 
ways,  it  is  expended  so  as  to  increase  the 
supply  of  food,  clothing,  and  shelter  avail- 
able for  the  support  of  the  laborer.    Ttau^ 


96 


THE  ABO  OF  mTAKCB. 


all  combinations  among  laborers  to  dimin* 
ish  or  interfere  with  the  development  of 
oipital  amount  to  nothing  but  combina- 
tions to  do  the  whole  laboring  class  of  the 
country,  themselves  included,  as  much  harm 
as  they  can  by  interfering  with  the  opera- 
tion of  the  social  system  described  in  the 
first  lesson. 

We  may  now  see  that  in  spite  of  the  an- 
tagonisms which  from  time  to  time  arise 
between  the  employer  and  the  employed, 
capital  and  labor  are  each  indispensable  to 
the  other.  How  indispensable  labor  is  to 
capital  every  one  sees  without  argument, 
bat  many  do  not  seem  to  see  the  other  side 
of  the  tmth.  But  this  must  be  plain  if 
yon  will  reflect  for  a  moment  that  every 
laborer  or  employ^  in  the  country  is,  under 
oat  present  taws,  perfectly  at  liberty  to  get 
along  without  the  oaidtalist  if  he  is  able 
and  willing  to  do  so.  If  an  engineer  or 
fireman  is  dissatisfied  with  his  wages,  he  b 
not  compelled  to  remain  and  be  oppressed ; 
on  the  contrary,  the  whole  world  is  before 
him  where  to  choose.  If  s  :.iicklayn>  or 
carpenter  is  not  aatiafied  with  what  bis  em- 


X 


■M 


MSCE. 

wren  to  dimin* 
levelopment  of 
I  but  conibina- 
iQg  class  of  the 
I,  as  much  harm 
inth  tho  opera- 
iscribed  in  the 

ipite  of  the  an- 
9  to  time  arise 
the  employed, 
idispensable  to 
ble  labor  is  to 
lout  argument, 
I  the  other  side 
St  be  plain  if 
ent  that  every 
nntty  is,  under 
t  liberty  to  get 
t  if  he  is  able 
m  engineer  or 
is  wages,  he  b 
be  oppressed; 
rorld  is  before 
'  licklayer  or 
l>  what  bis  em- 


CAPITAL  AMD  LABOB. 


27 


mmmmmimmmmmm' 


■Ahmi 


ployer  pays  him  for  his  work,  no  law  com- 
pels him  to  remain  working  for  wages  so 
low :  he  is  free  to  build  on  his  own  account, 
and  to  combine  with  men  in  other  trades 
to  any  extent  to  build  houses  for  them- 
selres.  If  the  laborers  of  the  country 
would  combine  in  ever  so  feeble  an  effort 
to  get  along  without  the  help  of  the  capi- 
talist, collecting  all  necessary  capital  for 
themselves,  and  working  on  their  own  ac- 
count, they  would  at  least  show  a  laudable 
disposition  to  be  independent.  The  very 
fbct  that  they  have  never  attempted  this, 
and  that  during  strikes  they  have  remained 
idle,  thus  causing  more  suffering  to  them- 
selves than  to  their  employers,  shows  that 
the  latter  are  really  necessary  to  them. 

One  way  in  which  the  employer  or  cafri- 
talist  is  necessary  to  the  hiborer  is  this: 
when  the  two  classes  combine  in  any  en- 
terprise, say  the  building  of  a  house,  the 
former  takes  all  the  risk.  Whether  the 
house  sells  well  or  not,  the  men  who  build 
it  get  their  wages,  and  thus  are  enabled  to 
live,  whereas  it  depends  altogether  on  how 
the  house  leUi  whether  the  capitalist  makes 


i 


wmmmss 


88 


THR  ABC  OF  riXAWCB. 


or  loses.  Thus,  the  men  very  wisely  trade 
off  their  cliances  of  large  profit,  which  they 
might  have  if  they  built  for  themselves,  for 
the  sake  of  being  certain  of  the  means  of 
living. 

The  best  solution  for  these  difficulties 
which  80  often  arise  between  the  two 
chisses  in  question  is  to  be  found  in  some 
^stem  of  co-operation,  whereby  the  labor- 
er, besides  having  regular,  but  low  wages, 
as  a  certainty,  shall  be  allowed  a  share  of 
the  profits,  if  there  are  any.  This  plan  has 
several  times  been  tried,  and  always,  I 
think,  with  success.  If  labor-unions  gen- 
erally would  move  for  it,  instead  of  waging 
a  suicidal  war  by  entirely  refusing  to  work 
for  weeks  or  months  at  a  time,  they  would 
do  more  for  their  own  well-being  than  by 
any  other  plan  they  have  yet  tried,  and 
would  show  better  than  they  ever  have 
shown  that  they  understood  their  own  in- 
terests. 


»  s 


9V> 


trcB. 


8TABVATION  WA0E8. 


y  wisely  trade 
fit,  which  they 
themselves,  for 
'  the  means  of 

ise  difficulties 
reen  the  two 
bund  in  some 
3by  the  labor- 
ut  low  wages, 
ed  a  share  of 
This  plan  has 
ind  always,  I 
ir-unions  gen- 
nd  of  waging 
ising  to  work 
e,  they  would 
>eing  than  by 
ret  tried,  and 
ey  ever  have 
their  own  in- 


t  > 


»i 


LE880N  ra. 

BTARVATION  WAGES. 

A  FEW  weeks  ago  it  was  said  that  several 
railroads  of  the  country  lowered  the  wages 
of  their  men  to  the  starvation  point.  Now, 
I  confess  that  I  do  not  know  what  the 
"starvation  point"  is,  and  so  cannot  say 
whether  this  is  true  or  not;  but  I  will  re- 
mark, in  passing,  that  there  has  been  with- 
in the  past  year  or  two  a  great  fall  in  the 
price  of  nearly  everything  necessary  to 
the  laborer's  comfort ;  and  that  starvation 
wages  will  buy  a  great  deal  more  than  they 
would  two  or  three  years  ago.  Possibly  if 
the  railroad  employes  had  devoted  half  the 
exertion  to  getting  cheap  food  and  clothing 
which  they  have  devoted  to  prevent  a  fell 
of  wages,  they  would  flnd.that  their  starva- 
tion wages  would  secure  them  as  many  of 
the  comforts  of  life  as  the  higher  wages  of 
two  or  three  yeare  ago  did.  But  we  need 
not  stop  to  discuss  whether  this  is  so  or 
not    We  most  pass  on  to  some  further  con- 


II 


¥f 


■yppjjjHH    g 


30 


niS  ABC  or  FIMANCa. 


■iderations.  The  men  were  not  satisfied 
with  their  irages,  and  refused  to  run  tho 
trains.  Now,  if  the  redaction  of  the  wages 
was  really  unnecessary  and  unjustifiable, 
the  men  wore  quite  right  in  thus  refusing 
to  work,  provided  that  they  did  not  seek 
to  interfere  with  tho  rights  or  with  tho 
property  of  any  one  else.  But  tho  fact  was, 
that  there  were  a  largo  number  of  other 
men,  whom  wo  will  call  Jones,  and  Brown, 
and  so  on,  quite  ready  to  take  the  places 
of  those  who  would  not  work,  and  to  run 
the  trains  for  those  starvation  wages.  They 
had  a  perfect  right  thus  to  accept  the  best 
employment  they  could  get,  and  the  road 
had  an  equal  right  to  employ  them.  But 
the  strikers  drove  them  off,  reibsing  even 
to  let  them  have  this  poor  opportunity  to 
earn  a  little  to  keep  their  fiimilies  from 
starving.  Now,  what  does  this  show! 
Why,  the  very  &ct  that  Brown  and  Jones 
were  willing  to  enter  the  service  of  the 
roads  at  those  starvation  wages  shows  that 
they  could  not  get  even  those  wages  at 
other  employments.  They  were  either  ab- 
aolately  out  of  employment,  or  were  work- 


I 


NCB. 

a  not  satisfied 
ed  to  run  tho 
n  of  the  wages 
1  unjustifiable, 
1  tlius  refusing 
'  did  not  seek 
B  or  with  tho 
it  tho  fact  was, 
mber  of  other 
28,  and  Brown, 
kkc  the  places 
rk,  and  to  run 
I  wages.  They 
tccept  the  best 
,  and  the  road 
)y  them.    But 

reibsing  even 
>pportunity  to 

fiunilies  from 
I  this  show! 
■rn  and  Jones 
Knrioe  of  the 
lat  shows  that 
lose  wages  at 
rere  either  ab- 
or  were  work- 


STAIIVATIOM  WAOK8. 


31 


ing  for  aomething  below  the  limit  which 
the  companies  sot,  or  else  they  would  nol 
be  willing  to  enter  their  service  under  the 
circumstances.  Thus  the  strikers  by  their 
action  prevented  these  unfortunate  men 
from  even  earning  the  miserable  pittance 
for  which  they  themselves  refused  to  work. 
You  think,  perhaps,  that  the  companies 
ought  not  only  to  have  paid  higher  wages 
to  those  who  were  actually  running  their 
trains,  but  also  to  have  taken  a  number  of 
these  starving  Joneses  and  Browns  in,  in 
order  to  help  them.  But  the  means  of  the 
companies  are  necessarily  limited.  A  com- 
pany gets  only  a  certain  number  of  dollars 
from  passengers  and  freight  with  which  to 
pay  its  employes,  and  it  cannot  pay  out 
more  than  this  amount  for  any  purpose 
whatever,  any  more  than  two  and  two  can 
make  five. 

We  all  know  that  the  gross  receipts  of 
nearly  every  railway  in  the  country  have 
greatly  diminished  during  the  past  five 
years.  It  is  there&re  simply  impossible  to 
run  tho  roads  without  cutting  down  the 
wages  of  some  one.    The  very  fact  that 


HMMIaMB 


i 


mm 


'^mu^K 


38 


Tm  ABC  OF  FINANCE. 


there  were  so  many  poor  fellows  ready  to 
run  the  trnins  nt  tlio  diminiahcd  wages,  be- 
cause there  was  nothing  else  for  them  to 
do,  Bcctns  to  me  to  provo  that  there  was  no 
entirely  unjustifiable  reduction.  I  confess 
I  do  not  think  those  who  wish  for  the  ini- 
proTomont  of  the  laboring  class  should  have 
anything  like  as  much  sympathy  with  the 
strikers  as  they  should  have  with  those 
poor  men  unable  to  cam  the  pittance  of 
perhaps  ninety  cents  a  day.  In  interfering 
with  their  employment,  the  strikers  showed 
themselves  in  the  light  of  cruel  tyrants,  re- 
gardless of  those  laws  of  freedom  and  prop- 
erty which  have  been  the  means  of  keeping 
them  from  serfdom. 

I  must  not  bo  understood  as  seeking  to 
Justify  the  general  mam^mcnt  of  the 
railroads  during  the  iMt  ten  years,  or  as 
claiming  that  the  men  had  no  reasonable 
ground  of  complaint.  Every  one  who  has 
the  cause  of  humanity  at  heart  must  hope 
for,  the  time  when  there  will  be  more  sym- 
pathy between  the  laborer  and  his  employ- 
er, and  when  the  latter  will  look  on  the 
former  as  one  in  whose  happiness  be  has 


an 

6«> 
en 

sni 
tlu 
an 
lea 
roi 
a( 
mi 
uli 
oti 

I 

■ti 
wl 
•h< 
th< 
m( 

let 
tb< 
wl 
b 
m 
■k 
In 


»*MB 


•m 


XCK. 


BTAKVATIOK  WAORS. 


Hows  ready  to 
ihcd  wages,  bc- 
90  for  them  to 
<t  there  was  no 
ion.  I  confess 
ish  for  the  ini- 
as  should  have 
lathy  with  the 
ve  with  those 
^e  pittance  of 
In  interfering 
trikers  showed 
"ucl  tyrants,  rc- 
dom  and  prop- 
ans  of  keeping 

1  as  seeking  to 
:emcnt  of  the 
in  years,  or  ns 
no  reasonable 
y  one  who  has 
sart  must  hope 
1  be  more  sym- 
nd  his  employ- 
I  look  on  the 
ppioess  he  has 


an  interest.  But  improrements  like  this 
go  on  very,  very  slowly,  so  that  no  one  gen- 
eration can  ever  see  them  brought  about, 
and  any  attempt  to  hurry  them  only  keeps 
them  back.  Hympathy  and  good  feeling 
are  not  promoted  by  war  of  any  kind,  and 
least  of  all  by  a  war  like  that  of  the  rail- 
road men  against  law,  order,  and  ciTili- 
sation  generally.  However  bad  railroad 
managers  in  general  may  be, -in  this  partic- 
ular case  they  were  in  the  right  and  the 
others  in  the  wrong. 

There  is  one  very  important  feature  of 
strikes  and  labor  movements  generally 
which  people  seldom  notice,  but  whicb 
should  seriously  modify  our  opinions  of 
them.  We  are  apt  to  think  of  all  these 
movements  as  made  for  the  benefit  of  the 
great  masses  of  unskilled  lalx>rert,  or,  at 
least,  as  being  planned  and  exe>juted  by 
them.  A  very  little  reflection  upon  fiwta 
which  we  all  know  will  show  us  that  this 
is  an  entire  mistake,  and  that  strikes  of  the 
most  numerous  class  of  laborers — the  on- 
•killed  ones— are  rare  and  unimportant. 
la  the  late  railway  war,  it  woa  not  the  men 


|i* 


IWl11*<i 


■«*■ 


34 


THE  ABO  or  FIMANCK. 


willing  to  work  for  ninety  cents  a  day  who 
•truck,  but  ongineors  ).nd  drcmen  potMtft- 
ed  of  such  BklU  that  they  could,  in  ordins* 
ry  times,  earn  moro  thac  was  Bufliciont  for 
their  support,  and  belonging  to  an  associa- 
tion wtdch  was  boasted  to  command  mill- 
ions of  dollars.  All  the  other  strikes  of 
which  we  have  so  often  heard  hare  been 
by  miners,  bricklayers,  masons,  carpenters, 
batters,  and  so  on,  but  not  by  day-laborers. 
Now,  this  last  is  the  class  which  should 
most  command  the  sympathy  of  the  phi- 
lanthropist, because  it  is  the  most  helpless 
class;  but  it  is  the  very  one  against  which 
the  rules  and  customs  of  trades-unions  op- 
erate most  vigorously.  The  higher  classes 
can  take  care  of  themselves,  but  these  can- 
not so  easily  do  so. 

The  worst  pvt  of  the  policy  of  trades- 
nnions  is  thai  which  seeks  to  limit  the 
number  of  men  who  shall  be  allowed  to 
learn  a  trade.  Not  only  are  vast  numben 
of  men  thus  compelled  to  remain  day-la- 
borers who  might  otherwise  attain  skill  4n 
some  trade,  but  all  the  articles  which  skiU< 
ed  labor  prodacea  are  made  scarcer.    If 


■MMBMl 


NCC. 

ints  A  day  who 
ircmen  pOMefl»- 
mid,  in  ordin»< 
18  Bufliciont  for 
( to  an  owocia- 
conimaud  miU- 
;hcr  strikes  of 
urd  bare  been 
JOB,  carpentciB, 
>y  day-laborert. 
wliicli  should 
hy  of  the  phi- 
a  most  helplesa 
I  against  which 
ides-unions  op- 
)  higher  classes 
,  but  these  can- 

olicy  of  trades- 
»  to  limit  the 

be  allowed  to 
«  vast  numbers 

remain  day-la- 
e  atUin  skill  4n 
lies  which  skill- 
ide  scarcer.    If 


STAHVATION  WAOM. 


35 


these  articles  were  usod  only  by  men  of 
wealth,  the  men  who  sympathize  with  '.he 
Inlrarer  would  not  so  much  care.  But  such 
is  not  the  case.  It  is  mathematically  cer- 
tain that  laborers  cannot  have  more  house- 
room  than  they  now  have  till  more  houses 
are  built  for  thum,  and  this  cannot  be  done 
without  more  bricklayers,  carpenters,  plas- 
terers, and  so  on.  The  same  remark  will 
apply  to  nearly  everything  which  the  labor- 
er needs  to  live  in  comfort  Bkiiled  labor 
is  necessary  to  produce  it,  ana  many  skill- 
ed  laborers  are  banded  together  tc  make 
their  work  as  scarce  and  dear  as  possible. 

There  is  one  important  lesson  to  be  learn- 
ed ftom  all  this.  The  progress  of  humanity 
fW>m  the  time  when  the  laborer  was  little 
better  than  a  serf,  livini;  in  a  smoky  cabin 
with  its  thatched  ro-'>f  .  :'*  unwholesome 
air,  eating  Slack  bread,  u^d  going  to  his 
work  barefoot,  up  to  the  present,  whtn  the 
industry  of  a  continent  is  at  work  supplying 
his  wants,  has  been  very  slow  and.  gradual. 
"Riis  coarse  of  progress  has  always  encoun- 
tered enemies  more  or  less  effective.  But 
the  worst  and  most  destructive  enemy  it 


ii* 


36 


TUB  ABC  OF  FIXAMCB. 


has  ever  encountered  is  to  be  found  in 
those  trades -unions  trliich  have  been  en- 
gaged in  saving  up  money  from  the  labor- 
ers' earnings  in  order,  from  time  to  time, 
to  wage  wars  against  production  through 
strikes.  That  a  certain  small  proportion 
of  these  movements  may  have  been  justifia- 
ble I  do  not  deny ;  but  the  larger  number 
of  them  have  been  carried  through  at  the 
expense  of  on  amount  of  privation,  misery, 
and  even  death,  as  well  as  of  injury  to  the 
productive  power  of  the  country,  for  which 
no  good  trades-unions  have  ever  done  can 
compensate.  However  we  may  admire  the 
heroism  of  the  men  engaged,  we  must  not 
forget  that  their  war  has  generally  been 
waged  against  the  very  instrumentalities 
designed  to  feed,  clothe,  and  shelter  them. 


To  proceed  fkirther  with  these  questions, 
we  must  know  something  of  the  nature 
and  functions  of  money.  Here  we  come 
into  a  field  where  it  is  almost  as  necessary 
to  unleam  as  it  is  to  learn.  There  are  two 
entirely  groundless  ideas  prevalent  respect- 


I 


ros. 

be  found  in 
have  been  en- 
rom  the  labor- 
time  to  time, 
ction  tlirough 
all  proportion 
B  been  justifia- 
larger  number 
hrough  at  the 
vation,  misery, 
f  injury  to  the 
atry,  for  which 
ever  done  can 
lay  admire  the 
I,  we  must  not 
generally  been 
strumentalities 
1  shelter  them. 


bese  questions, 
of  the  nature 
9ere  we  come 
«t  as  necessary 
There  are  two 
nrslent  respect- 


ONK  OOLLAB. 


37 


ing  the  value  of  money,  which  have  no 
more  real  foundations  than  the  notions 
about  witchcraft  which  prevailed  a  couple 
of  centuries  ago,  and  on  which  a  large  part 
of  the  fallacies  of  the  subject  is  found- 
ed. Until  these  ideas  are,  so  to  spealc,  un- 
learned, no  progress  is  possible. 


LESSON  IV. 

ONB    bOLLAS. 

Thb  first  idea  to  which  I  allude  is,  that 
if  anything  is  called  a  dollar  by  act  of  Con- 
gress, if  every  one  passes  and  accepts  it  as 
a  dollar,  it  must  therefore  have  a  definite 
and  fixed  value,  and  be  for  all  practical 
purposes  just  as  good  as  a  gold  dollar. 
Tou  think,  perhaps,  that  a  dollar  must  be 
worth  just  one  dollar,  and  neither  more  nor 
less;  how, then, can  its  value  be  uncertain  t 
I  answer  that  two  kinds  of  dollars  can  dif- 
fer from  each  other  in  value  just  as  much 
as  two  loaves  of  bread  can  in  rize  and 
quality.    Yon  know  very  well,  for  instance, 


38 


THE  ABC  OF  FIXANCB. 


that  dnring  the  past  ten  years  our  paper 
dollar  has  been  worth  from  five  to  thirty 
per  cent  less  than  the  gold  dollar.  To 
explain  the  matter  iully,I  must  perhaps  be 
n  little  abstruse,  and  therefore  ask  a  closer 
attention  than  I  will  elsewhere. 

When  I  say  that  a  paper  dollar  can  have 
no  definite  and  fixed  value,  I  mean  that  it 
cannot  be  insured  to  buy  you  any  fixed  and 
definite  quantity  of  the  necessaries  of  life. 
Money  has  no  value  at  all  except  for  the 
things  it  will  buy ;  you  can  neither  eat  it, 
drink  it,  nor  wear  it;  nor  can  you  even 
gain  interest  on  it  while  it  remains  in  your 
pocket  Wliat  you  want  of  it  is  to  buy 
things  to  eat,  drink,  and  wear,  and  the 
number  of  these  things  it  will  buy,  and  not 
the  number  of  dollars,  is  the  measure  of  its 
value.  Ton  would  not  give  a  fig  for  a 
pocketfiil  of  dollars  if  you  could  buy  only 
the  half  of  a  fig  with  them.  If  this  year 
you  bad  supported  your  fiunily  on  five  hun- 
dred dollars,  but  next  year  it  dioald  re- 
quire one  thousand  dollars  because,  on  the 
average,  prices  had  doubled,  peopie  would 
say  that  the  value  of  eveiythhig  was  twice 


W3t^ 


B?sr 


SCE. 

lars  OUT  paper 
five  to  thirty 
d  dollar.  To 
lut  perhaps  be 
re  ask  a  closer 
re. 
oUar  can  have 

I  mean  that  it 
any  fixed  and 

ssaries  of  life, 
jxcept  for  the 
neither  eat  it, 
can  you  even 
smains  in  yonr 
f  it  is  to  bay 
w^ear,  and  the 

II  buy,  and  not 
measure  of  its 
'e  s  fig  for  a 
»uld  buy  only 
I.  If  this  year 
ily  on  five  hun- 

it  riioald  re- 
liecause,  on  the 
,  peopid  would 
ling  wa*  twice 


sjasSSlB^BB^BBW^cjsfew^ 


OmC  DOLLAB. 


39 


as  great  as  before.  But  this  would  be  an 
incorrect  use  of  language.  Really  the  value 
of  your  dollars  is  only  half  what  it  was 
before.  Please  remember  that  this  is  the 
only  sense  in  which  I  now  use  the  word 
"value,"  and  the  only  sense  in  which  it 
has  a  definite  practical  meaning.  Dolkura 
and  all  other  kinds  of  money  are  worth 
what  they  will  buy  you  to  eat  and  wear; 
and  measuring  value  by  any  other  stand- 
ard is  like  trying  to  feed  a  hungry  man  on 
acts  of  Congress. 

AH  the  difficulty  of  this  matter  arises  from 
the  fact  that  valve  is  something  which  can- 
not be  seen  nor  Alt.  If  Congress  should 
enact  that  all  the  foot  and  yard  measures 
of  the  country  should  be  made  of  a  kind 
of  rubber  which  would  shrink  to  nine 
inches  in  the  course  of  a  few  months,  but 
which  were  nevertheless  stamped  "One 
fbot,  by  act  of  Congress,"  or  "  One  yard," 
as  the  case  might  be,  everybody  would  see 
at  a  glance  how  lidicnlous  it  would  be  to 
teqoiie  every  one  to  buy  and  sell  by  such 
meamres.  If  a  man  should  boast  of  hav- 
ing grown  a  foot  and  a  half  in  the  coun« 


^immm 


40 


TUB  ABO  or  nKANCB. 


of  a  year,  because  last  year  he  meastued 
only  five  feet,  while  with  the  new  india- 
rubber  measures  be  was  now  six  feet  and 
a  half  by  act  of  CSongreu,  his  neighbors 
would  laugh  at  hinu  The  fact  that  every- 
body  might  call  the  new  rubber  measures 
one  foot,  and  might  buy  and  sell  by  them, 
would  not,  in  the  view  of  any  sensible  man, 
make  them  as  long  as  the  old  foot-rules. 

The  reason  that  these  india-rubber  meas- 
ures would  look  so  much  more  ridiculous 
than  umilar  dollars  is  simply  that  their  de- 
ficiency in  length  is  obvious  to  the  eye, 
whereas  the  depreciation  of  the  dolUr  is 
not  obvious.  In  reality,  calling  a  thing 
one  dollar,  and  legalizing  it  as  such,  no 
more  makes  it  the  equivalent  of  a  gold  dol- 
lar, or  of  anything  else  in  value,  than  call- 
ing it  a  foot  will  make  it  a  foot  long,  no 
matter  what  its  real  length  may  be.  But 
we  cannot  see  nor  feel  the  depreciation  of 
the  dollar  as  we  would  see  the  shortening 
of  the  foot  measure.  We  become  aware  of 
it  only  by  the  general  rise  of  prices,  and 
the  general  increase  in  the  cost  of  living. 
This  rise  of  prices,  however,  proves  the  de> 


-vr 


;cE. 


aovBiumEST  oankot  oivb  valck.  41 


he  measured 
le  new  india- 
r  six  feet  and 
his  neighbors 
ict  that  every- 
!)bcr  measures 
sell  by  them, 
sensible  man, 
1  foot-rules, 
t-rubber  meas- 
ore  ridiculous 
that  their  de- 
is  to  the  eye, 
'  the  dollar  is 
lling  a  thing 
t  as  such,  no 
of  a  gold  dol- 
lue,  than  call- 
foot  long,  no 
may  be.  But 
epreciation  of 
:he  shortening 
some  aware  of 
of  prices,  and 
:ost  of  living, 
proves  the  de« 


preciation  in  the  same  way  that  the  little 
man  measuring  six  feet  six  in  bis  stockings 
would  prove  that  the  foot-rule  with  which 
he  was  measured  was  too  short. 

If,  now,  the  reader  will  hereafter  remem- 
ber that  "dollar"  is  only  a  word,  not  a 
thing;  that  ca  ling  a  thing  a  dollar  does 
not  change  its  nature,  and  does  not  make 
it  worth  twenty-three  grains  of  gold,  any 
more  than  calling  a  piece  of  paper  a  hone, 
and  having  it  declared  and  stamped  a 
horse  by  act  of  Congress,  would  make  it 
draw  a  carriage — it,  I  say,  he  will  perma- 
nently remember  this,  he  will  have  taken 
the  first  great  step  towards  comprehending 
the  financial  question. 


LESSON  V. 

TALUB  CAHHOT  BB  OIVEN  BT  GOVEBmiBllT. 

The  second  notion  to  be  unlearned  is 
intimately  associated  with  the  former  one. 
It  is  that  governments  possess  some  wotf- 
derfhl  power  of  giving  value  to  money, 


It! 


mm 


4S  THB  ABO  or  mrAHOB. 

which  every  one  must  admit,  but  which  no 
one  can  explain.  Widely  as  thia  notion  is 
extended,  it  is  as  pun  a  supeistition  as  was 
the  old  notion  that  a  witch  could  make  her 
enemy  sick  by  secretly  making  a  wax  im> 
age  of  him,  and  then  by  sticking  pins  into 
it,  roasting  it  before  the  fire,  and  otherwise 
torturing  it,  could  make  him  suffer  corre- 
aponding  tortures.  The  disproof  of  this 
theory  by  an  appeal  to  facts  is  easy  and  con- 
clusiTe.  Every  man  of  intelligence  knows 
that  the  coined  money  of  all  nations  is 
worth  only  the  gold  which  is  in  it,  except 
that  the  coin  bears  a  slight  premium,  ow- 
ing to  the  certainty  that  it  is  the  real  met- 
al; whereas  the  gold  uay  have  to  be  as- 
sayed, and  the  cost  of  the  assay  must  be 
deducted  fh>m  its  value.  In  other  words, 
the  coined  money  may  bear  a  premium 
over  the  mere  bullion  equal  to  the  cost  of 
coinage.  The  stamp  of  Ckivemment  goes 
for  al^lutely  nothing,  except  a  certificate 
of  the  wdght  and  quality  of  the  metal. 

Now,  if  the  common  notion  were  cor- 
ieet,  the  coin  might  be  vastly  more  valua- 
ble than  the  crude  bullion  out  of  which  it 


I 


"^-pr 


rot. 

but  which  no 
this  notion  is 
ratition  as  was 
raid  make  her 
ng  a  wax  im- 
ung  pins  into 
and  otherwise 
1  suffer  corre- 
sproof  of  this 
I  easy  and  con* 
ligence  knows 
all  nations  is 
is  in  it,  except 
premium,  ow- 
I  the  real  met- 
lave  to  be  as- 
issay  must  be 
1  other  words, 
ir  s  premium 
to  the  cost  of 
remment  goes 
pt  a  certificate 
the  metal, 
ion  were  cor* 
ly  more  valua- 
rat  of  which  it 


OOVBBinnKT  CASMOT  QtVm  VALUE.    43 

was  made,  the  premium  depepding  on  how 
great  and  powerful  a  nation  put  its  stamp 
on  it  But  all  nations  are  here  on  a  dead 
level;  their  stamps,  one  and  all,  go  for  Just 
nothing,  so  far  as  giving  value  is  concerned. 
The  dollars  of  the  poorest  South  American 
states,  the  sovereigns  of  England,  he  na* 
poleons  of  France,  and  the  gold  bars  firesh 
from  the  mines  without  any  Government 
stamp  upon  them,  all  exchange  in  the  mar- 
kets of  the  world  according  to  the  amount 
of  gold  in  them,  and  nothing  else.  This 
fact  is  a  conclusive  reftatation  of  the  opin- 
ion that  Oovemment  can  confer  value  on 
anything  by  its  stamp. 

A  maxim  is  often  quoted  which  is  true 
in  one  sense  and  not  true  in  another,  but 
which  people  are  expected  to  believe  in 
the  sense  in  which  it  ia  not  true.  It  w  said 
that  the  dollar  is  anything  which  the  law'^ 
makes  it.  To  see  in  what  sense  this  is  true, 
let  us  take  the  similar,  but  easier,  case  of 
a  loaf  of  bread.  Our  city  authorities  may 
have  the  power  to  declare  how  much  bread 
■hall  constitute  a  loaf,  and  this  year  they 
may  provide  that  the  loaf  shall  wdgh  one 


|l! 


wiltimmmmmm 


44 


THS  ABC  OF  nXAMOt. 


pound ;  next  year,  two  pounds ;  and  the 
year  after,  half  a  pound.  They  might  alao, 
fVom  time  to  time,  allow  the  baker  to  add 
com  or  rye  meal  to  hia  flour.  We  might 
then  say  that  the  loaf  of  bread  was  any- 
thing which  the  Uw  made  it  But  it  would 
not  follow  that  the  loaf  of  one  year  was  the 
same  aa  that  of  another,  and  it  would  be 
monstrous  for  the  law  to  suppose  them  the 
same.  It  is  the  same  with  the  dollar.  If 
Congress  provides  a  gold  dollar  tliis  year, 
and  a  sUver  dollar  next  year,  and  a  paper 
dollar  the  year  after,  there  is  no  necessary 
relation  of  value  between  these  different 
dolhui  any  more  than  between  the  loaves 
of  bread  we  have  supposed. 

I^  now,  the  reader  will  remember  that 
there  is  only  one  kind  of  value,  namely, 
that  measured  by  the  necessaries  of  life  any- 
thing will  conunand  in  the  market,  and  that 
the  value  of  a  gold  dollar  does  not  differ 
in  any  essential  respect  teem  that  of  the 
same  quantity  of  gold  in  a  nugget,  he  will 
have  taken  the  second  great  step  towardB 
understanding  the  money  question. 


sets. 

inds;  and  the 
ley  might  alio, 
I  baker  to  add 
ir.  Wo  might 
read  was  any- 
But  it  would 
le  year  was  the 
d  it  would  be 
>po8e  them  the 
the  dollar.  If 
ollar  this  year, 
jr,  and  a  paper 
8  no  necessary 
these  different 
een  the  loaves 

remember  that 
value,  namely, 
ries  of  life  any- 
larket,  and  that 
loes  not  differ 
m  that  of  the 
lugget,  he  will 
t  step  towarde 
lestion. 


THB  VALUK  or  PAFUt  MONEY.         46 


LESSON  VI. 

■mB  TALUS  OF  PAPEB  KOKET. 

Wrrn  these  two  ideaa  onleamed,  we  are 
in  a  proper  state  of  mind  to  inquire  what 
gives  value  to  paper  money.  You  know 
that,  practically,  far  the  greater  part  of  the 
business  of  the  world  is  canied  on  by  us- 
ing paper  or  credit  instead  of  gold.  Only 
an  insignificant  fraction  of  mercantile  pay- 
ments are  made  by  actoslly  counting  out 
gold.  If  one  merchant  has  to  pay  anoth- 
er a  thousand  dollars  in  gold,  he  si^iply 
hands  him  a  check  for  the  amount,  which 
the  second  merchant,  perhaps,  passes  over 
to  some  one  else.  Here  is  a  piece  of  paper, 
of  no  value  whatever  in  itsei^  passed  from 
band  to  hand  just  as  if  its  value  were  a 
thousand  gold  dolhuu  How  is  this  ?  Can 
we  say  with  correctness  that  the  check  has 
any  real  value?  The  answer  is  clear  and 
simple.  The  value  does  not  reside  in  the 
check  itself,  but  in  the  28,200  grains  (say 
thiee  ponndis  avoirdupois)  of  gold  to  which 


m 


II! 


ipnM 


MHMI 


4« 


TRH  ABC  or  FINANCE. 


the  holder  of  the  check  is  entitled,  and 
which  he  knows  the  bank  is  able  and  ready 
to  pay  him.  That  is  all.  If  the  bank  is 
not  bound  to  pay  the  check,  no  niatter 
how  many  dollars  may  be  marked  on  it, 
no  matter  how  beautlftil  the  engraving,  it 
is  worth  nothing.  If  the  check  is  not  pay- 
able !n  gold,  but  in  greenbacks,  then  it  is 
worth  not  a  thousand  dollars  in  gold,  but 
only  in  greenbacks.  So  it  is  with  all  the 
commercial  paper  money  of  the  world, 
which  circulates  in  such  enormous  quanti- 
ties in  place  of  money.  Its  solo  basis  is 
that  responsible  men  are  bound  to  pay 
it,  and  its  only  vatue  depends  upon  the 
Weight  of  the  gold  to  which  it  entitles 
the  holder,  no  matter  whether  it  is  called 
ponnda,  fhincs,  or  dollars. 

Observe  carefblly  that  it  is  n't  sufficient 
that  the  paper  "represents"  so  i  uch  gold, 
or  that  the  firm  which  issues  it  is  very 
wealthy  or  powerftal.  The  holder  of  the 
paper  muot  htya  an  acknowledged  right  to 
the  gold,  which  the  bank  is  not  going  to 
dispute.  If  there  is  any  donbt  whether  he 
himself  or  any  one  to  whom  he  may  pass 


i 


LNCS. 

8  entitled,  and 
able  and  ready 
If  the  bank  is 
eck,  no  niatter 
marked  un  it, 
10  engraving,  it 
leck  ia  not  pay- 
acks,  then  it  ia 
irs  in  gold,  but 
ig  with  all  the 
of  the  world, 
lormous  quanti- 
:t8  solo  Imsis  is 
bound  to  pay 
ends  upon  the 
liich  it  entitle* 
ther  it  is  called 

is  wt  sufficient 
"soi.  uch  gold, 
isues  it  is  very 
i  holder  of  the 
riedged  right  to 
is  not  gohig  to 
rabt  whether  he 
am  he  may  pa« 


Tm  V.U.UX  or  papkb  mokky. 


47 


the  cheek,  will  be  able  to  get  the  gold  for 
it,  then  the  check  will  be  depreciated.  If 
it  is  certain  that  no  one  can  over  get  the 
gold  for  it,  its  value  will  be  just  that  of  • 
pretty  picture  for  the  children  to  play  with, 
no  matter  how  strongly  it  may  be  declared 
to  represent  a  thousand  dollars. 

Now,  with  a  single  exception,  which  w« 
shall  consider  presently,  the  value  of  Gh>T- 
emment  paper  money  is  determined  in  pre- 
cisely the  same  way  with  that  of  mercan- 
tile  paper.  In  itself  it  has  no  value  at  all. 
Congress  may  atamp  it  one  dollar  or  one 
hundred  dolhurs;  but  unless  it  entitles  the 
owner  to  cUdm  something,  it  is  a  mere  p}ooe 
of  paper.  If  the  owner  can  actually  get  • 
gold  dollar  with  it,  it  is  worth  a  gold  dol- 
lar; otherwise  it  will  be  more  or  less  de- 
preciated in  value,  according  to  the  hope 
of  future  payment  which  the  holders  may 
entertain.  Of  course  Congress  can  mtdce 
every  one  call  it  a  dollar  and  receive  it  un- 
der that  name,  but  we  have  seen  in  the  first 
lesson  that  this  does  not  fpve  it  real  value 
—that  is,  purchasing  power.  If  any  one  it 
compelled  to  take  It,  be  simply  puts  up  the 


I 


■t 


48 


Tim  ABO  or  miAMoi. 


price  of  everything  he  hM  to  mII  1b  pro- 
portion to  the  depreciation  of  the  paper,  to 
that  the  result  is  the  ume  aa  ii  the  paper 
paMed  at  a  diacount. 

We  must  now  point  oat  a  fullacy  by 
which  the  supporters  of  irredeemable  pa- 
per money  often  try  to  get  round  these  con- 
iiderations.  It  is  said  that  the  greenbacks, 
or  their  proposed  paper  dollars,  are  to  be 
issued  "  on  the  credit  of  the  nation,"  and 
therefore  must  have  value  in  proportion  to 
that  credit,  even  if  the  nation  docs  not  re- 
deem them. 

The  word  " credit"  is  here  used  in  some 
pecuMar  sense  (which  no  one  can  fhlly  ez- 
pUifO  wholly  different  flrom  its  commercial 
sense.  In  the  world  of  business,  "  credit " 
includes  the  ability  and  the  obligation  to 
pay  all  demands  in  cash  as  they  become 
due.  A  man  or  a  firm  tliat  cannot  do  this 
has  no  credit,  however  excellent  it  may  be 
in  other  respects.  Suppose  you  should  be 
travelling  in  a  distant  city,  and,  going  to 
the  cashier  of  your  hotel  for  change,  he 
hands  you  a  ten-dollar  bill  on  the  banking 
firm  of  Spread,  Brothers,  A  Co. 


Id. 

to  sell  in  pro- 
f  the  paper,  so 
ta  if  tlie  paper 

;  n  fullacy  by 
Btloomable  pa- 
und  thcie  con- 
he  greenbacks, 
lars,  are  to  be 
e  nation,"  and 
1  proportion  to 
m  docs  not  re- 

B  used  in  some 
0  can  Ailly  ex- 
its commercial 
iness,  "credit" 
D  obligation  to 
a  they  become 
cannot  do  this 
Uent  it  may  be 
you  should  be 
,  and,  going  to 
for  change,  he 
on  the  iMuiking 
Co. 


Tin  VAi.ua  or  PAnm  uotnv. 


4» 


"Are  you  sure  this  bill  Is  good  t"  you  in- 
quire. 

"  Good  as  gold,  sir.  The  firm  of  Spread, 
Brothers,  &  Co.  is  the  greatest  in  this  State, 
possessed  of  unbounded  wealth,  and  its 
operations  extend  over  the    holo  globe." 

"Then,"  you  reply,  "I  suppose  if  I  take 
this  bill  to  their  counter,  they  will  pay 
itt" 

"  Pay  it  I  Why,  no,  sir.  You  would  be 
hooted  by  the  small  boys  in  the  street,  and 
laughed  at  by  Spread's  clerks.  The  credit 
of  the  firm  la  so  excellent,  and  all  its  debts 
BO  well  secured  by  real  estate  and  bonds 
worth  millions  of  dollars,  that  both  the 
firm  and  the  community  concluded,  ten  or 
twelve  yean  ago,  that  there  was  not  the 
slightest  need  of  their  redeeming  their  bills, 
and  they  are  never  going  to  do  it." 

"  I  don't  understand  that  kind  of  credit 
In  my  State,  credit  paper  is  something 
which  the  party  issuing  is  bound  to  pay 
when  required ;  and  if  he  does  not  pay,  he 
has  no  credit,  no  matter  bow  rich  he  is." 

"Of  course  twopenny  Aims  must  pay. 
Bat  we  claim  that  a  firm  so  great,  powe^ 
4 


50 


THB  ABC  OF  rDTANCB. 


fill,  and  wealthy  as  that  of  Mr.  Spread  need 
not  pay." 

"Well,  sir,"  you  would  reply,  "I  don't 
see  what  difference  it  makes  to  mo  how 
wealthy  Spread's  firm  is,  or  how  well  their 
paper  is  secured,  if  I  can't  get  any  of  their 
wealth  in  exchange  for  my  bill.  I  always 
thought  the  advantage  of  having  the  pa- 
per of  a  wealthy  firm  was  that  it  was  surer 
to  be  paid ;  but  if  the  richer  the  firm,  the 
less  the  need  of  paying,  I  would  rather 
have  the  bill  of  some  smaller  house." 

*' Ah,  you  know  nothing  about  finance,  I 
see ;  and  I'll  get  you  some  foreign  money 
rather  than  argue  further  with  you." 

If  a  hotel  cashier  should  talk  in  this  way 
to  you,  you  would  be  a  little  puzzled  to  say 
whether  he  was  joking  or  in  earnest.  And 
yet  great  statesmen  do  argue  in  just  that 
way  about  our  greenbacks.  There  are  bills 
to  the  amount  of  four  hundred  millions  of 
dollars  afloat,  reading,  <'  Th«  UttUed  SUiiet 

wai  pay  ike  beatw dollars."    Yet  if  you 

should  *:.'m  one  of  these  bills  to  the  Oot- 
emment's  counter,  asking  that  this  prom- 
ise be  redeemed,  the  clerks  would  laugh  at 


I 


NCB. 

[r.  Spread  need 

reply,  "I  don't 
es  to  mo  how 
how  well  their 
;et  any  of  their 
bill.    I  always 
having  the  pa- 
lat  it  was  surer 
!r  the  firm,  the 
[  would  rather 
r  house." 
ftbout  finance,  I 
foreign  money 
ith  you." 
talk  in  this  way 
!  puzzled  to  say 
1  earnest.    And 
pie  in  just  that 
There  are  bills 
Ired  millions  of 
he  United  Siatet 
r»."    Yet  if  you 
ills  to  the  OoT- 
that  this  prom- 
would  laugh  at 


THE  VALUK  OF  PAPER  MONEY. 


51 


you.  A  year  or  two  since  some  one  did 
this  very  thing,  and  the  newspapers  specu- 
lated on  the  man's  sanity,  while  a  Treasury 
official  thought  he  was  only  trying  to  make 
himself  notorious.  If  a  politician  tries  to 
justify  permanent  non-payment,  he  will 
talk  about  the  credit  and  wealth  of  the 
nation  exactly  as  the  hotel  clerk  talked 
about  Spread,  Brothers,  &  Co.  Now,  it  will 
be  a  very  profitable  mental  exercise  if  the 
reader  will  ask  himself  what  is  meant  by 
the  promise, "  The  United  Sates  will  pajf  the 

bearer dolUtrt;'"  and  if,  also,  for  each 

theory  of  the  subject  he  may  form,  he  will 
consider  how  it  will  look  for  a  banking 
firm  to  put  that  same  interpretation  on 
its  promises.  To  give  the  reader  time  to 
think  this  matter  over,  I  will  here  close 
this  lesson. 


SB  THE  ABC  OF  FmANOB. 


LESSON  vn. 

WHT  HAS  THB  ORBBHBACK  AlftT  VALTTB? 

Ih  the  last  two  lessons  I  have  sought  to 
show  the  falUcy  of  the  various  notions 
afloat  that  Government  possesses  some  pe- 
culiar power  of  giving  value  to  coined 
money  or  stamped  paper.  The  reader  who 
has  informed  himself  on  financial  history 
will  be  familiar  with  many  illustrations  of 
the  unpleasant  truth  of  the  views  herfe 
maintained.  In  the  history  of  the  bills  of 
credit  which  used  to  be  issued  by  our  colo- 
nies, and  which  have  been  issued  by  other 
governments  in  diffif  uiu  '  the  story  has 
been  told  over  and  o\e^  •:.  But  there 

are  also  some  apparent  ■■.  .v>  ti  is — cases 
in  which  money,  though  ft'  '  ;^  caterer  less 
i^ace  of  time  not  redeemable,  has  not  de- 
preciated to  nothing.  Our  greenbacks  are 
a  case  in  point.  The  reader  may  say, "  On 
your  theory  greenbacks  are  mere  pieces  of 
paper,  and  ought  not  to  be  worth  more 
than  the  paper  on  which  they  are  printed. 


NCB. 


AHT  VALUE? 

Iiave  sought  to 
arions  notions 
sesses  some  po- 
ilue  to  coined 
rhe  reader  who 
oancial  history 
illustrations  of 
he  views  herfe 

ofthe  bills  of 
ed  by  our  colo- 
issued  by  other 

the  story  has 
But  there 
>  ti  IS — cases 
'  J  ^^terorless 
>le,  has  not  de- 
greenbacks  are 
r  may  say, "On 
mere  pieces  of 
\}e  worth  more 
ley  are  printed. 


WHY  HAS  THB  OBEBNBACK  VALUE  T  53 

How  do  you  explain  the  fact  that  they 
continue  worth  from  eighty-five  to  ninety 
cents  on  the  dollar  in  gold  V 

I  answer  that  there  are  two  reasons  for 
the  continued  value  of  the  greenback. 
The  first  is,  that  everything  which  circu- 
lates as  money  in  a  community  may  have  a 
certain  value  merely  in  virtue  of  its  usefhl- 
ness  as  currency.  Even  the  value  of  gold  is 
much  greater  than  it  would  be  but  for  its 
usefulness  as  money.  There  are  certain 
conditions  under  which  it  is  theoretically 
possible  for  unredeemed  bills  to  be  on  a 
par  with  gold.  These  conditions,  which  it 
is  very  important  to  bear  in  mind,  are :. 

1.  That  the)  diaU  aduaUjfpau  ourrmt,  and 
be  reorived  as  "  bankable  fwmlt." 

2.  That  tMr  qmnHty  ehall  be  to  mall  ihat 
tkeg  arp  lii«H0lo{m(  to  form  the  entire  cinmUMng 
mediHm,  to  ihat  tome  gold  hat  iHll  to  be  uted. 
The  unteeraal  experience  of  all  natione  andpeO' 
pie  who  tiaee  ever  trkd  UU,thtUas  soon  at  ike 
omrrmeg  in  Umted  im  muK  quoMtiUet  at  enOray 
to Mtplaet  toldfUUibtkt  to depreoia<»— ttol it, 
^MiMoltapnmXwm, 

Tbia  ia  the  secret  ofthe  non-depredatioa 


64 


THS  ABC  or  nXANCB. 


of  the  bills  of  the  Bank  of  France  daring 
the  last  few  years,  while  specie  payments 
were  suspended.  There  were  not  enough 
notes  in  Paris  to  transact  its  business,  so 
that  gold  had  constantly  to  be  used  in  part. 
Had  the  American  theory  of  plenty  of  cur- 
rency been  acted  on,  there  is  no  knowing 
what  would  have  been  the  result. 

Now,  although  our  greenbacks  have  been 
isBued  in  a  greater  amount  than  was  neces- 
sary for  business,  as  is  conclusively  proved 
by  their  depreciation,  yet  the  amount  has 
been  limited  by  law.  It  has  been  still  fur- 
ther limited  by  the  fact  that  the  revennes 
of  the  Government  have  exceeded  its  ex- 
penditures, so  that  a  large  quantity  of  the 
greenbacks  have  not  been  in  actual  circu- 
lation. And  so  long  as  the  total  issue  of 
greenbacks  is  strictly  limited  to  its  present 
amount,  there  is  no  danger  of  their  total 
loss  of  value. 

The  second  reason  for  the  value  of  the 
greenback  is,  that  there  has  been  more  or 
less  expectation  of  ita  being  redeemed  some- 
time within  the  life  of  the  present  genera- 
tion.   Though  no  one  has  seen  exactly 


INCB. 

France  daring 
[wcie  payments 
!re  not  enough 
it«  business,  so 
be  used  in  part, 
f  plenty  of  cur- 
is  no  knowing 
result. 

Micks  have  been 
than  was  neces- 
lusiyely  proved 
he  amount  has 
8  been  still  fur- 
it  the  revenues 
xceeded  its  ex- 
quantity  cf  the 
in  actual  circu- 
B  total  issue  of 
d  to  its  present 
r  of  their  total 

lie  valae  of  the 
B  been  more  or 
redeemed  tome- 
present  genera- 
ls seen  exactly 


WHY  HAS  THB  OREKNBACK  VALUa  t  55 

how  specie  payments  were  going  to  be 
brought  about,  the  general  business  senti- 
ment of  the  country  has  been  that  wc  must 
reach  them  in  some  way.  The  greenbacks 
have  always  been  counted  as  part  of  the 
public  debt,  which  proceeding  implies  an 
obligation  to  redeem.  In  order  to  set  at 
rest  all  doubt  on  this  matter,  Congress,  in 
1869,  passed  a  law  pledging  the  faith  of 
the  nation  to  the  payment  of  the  green- 
backs in  coin ;  and,  in  1875,  it  set  a  date 
(January  Ist,  1879)  when  this  payment 
should  commence. 

To  these  two  reasons,  and  to  no  others, 
are  we  to  attribute  the  fact  that  our  green- 
backs have  not  gone  the  way  of  all  previ- 
ous systems  of  inedeemable  paper  money. 
The  reader  must  carefully  notice  that  nei- 
ther of  these  reasons  is  based  on  the  fiust 
that  the  greenbacks  are  issued  by  a  great 
government.  The  unredeemed  paper  of 
France  was  issued,  not  by  the  Government, 
but  by  a  bank ;  yet,  as  we  have  seen,  it  was 
more  successful  than  our  Government  pa- 
per. It  is  not  the  party  which  issues,  but 
ito  qtumUtg,  and  the  pro$peti  qf  itt  redemp- 


66 


THB  ABO  OF  WOIASCK. 


Mom,  which  detennine  its  yaluo.  Indeed, 
bonk  paper  is,  under  such  circumstances, 
far  less  liable  to  depreciation  than  Qovem- 
ment  paper,  for  the  reason  that,  if  the  pub- 
lic is  determined,  the  bank  can  always  be 
made  to  pay  up,  while  the  Government  can- 
not The  case  is  Jast  like  your  preference 
for  the  paper  of  a  small  house,  which  must 
pay,  over  that  of  a  firm  so  rich  and  powcr- 
ftd  that  it  is  above  paying. 

Tou  see  at  once  that  if  the  policy  of  the 
inflationists  were  permanently  inaugurated, 
both  of  the  reasons  for  the  value  of  the 
greenback  would  be  knocked  from  under 
it,  and  it  would  rapidly  go  the  way  of  the 
Continental  currency,  and  every  other  sys- 
tem of  Qovemment  paper  money  that  has 
ever  been  tried.  With  no  intention  to  re- 
deem in  coin,  a  note  would  be  a  mere  piece 
of  paper;  and  if  issued  in  such  quantities 
as  would  be  denumded,  although  every  one 
might  call  them  "  dollars,"  thek  purchadng 
power  would  diminish  without  limit 


mmm 


»CB. 


TUB  3.a5-BOMD  rLAS. 


57 


iiluo.  Indeed, 
circnmstances, 
1  than  Oovem- 
hat,  if  the  pub- 
can  always  be 
overnment  can- 
rour  preference 
Be,  which  must 
ch  and  powcr- 

e  policy  of  the 
ly  inaugurated, 
B  value  of  the 
ed  from  under 
the  way  of  the 
irery  other  sys- 
loney  that  has 
Dtention  to  re- 
le  a  mere  piece 
uch  quantities 
lugh  every  one 
eir  purchasing 
mt  limit 


LESSON  vm. 

THE  8.6S-B0ND  PLAN, 

Sous  advocates  of  —■^"■r  nioney  have  a 
more  or  less  dim  perct^ '  '  .  jf  the  fact  that 
a  paper  currency,  to  have  real  value,  must 
be  redeemable  ia  something.  At  the  same 
time  they  are  conscious  that  paying  out 
solid  gold  is  a  very  disagreeable  thing  to 
be  obliged  to  do.  So  they  have  a  most  in- 
genious plan  for  redeeming  the  currency 
in  something  vastly  better  than  gold,  and 
which  will  cost  the  Government  nothing 
but  the  trouble  of  printing  it.  This  some- 
thing is  to  be  Government  bonds  bearing 
inti^rest  at  the  rate  of  8.65  per  cent,  both 
principal  and  interest  being  payable  in  the 
same  paper,  to  redeem  which  the  bonds  wee 
issued. 

Now,  I  must  say  at  the  outset  that  if  the 
principal  and  interest  of  these  bonds  were 
payable  in  gold,  and  if  the  rate  of  inter- 
est were  so  high  that  capitalists  would  be 
ready  to  invest  in  them — if,  say,  it  were 


■Spi-.».w>yiiM 


&8 


ms  ABC  OF  flKANCE. 


five,  or  even  four  «nd  ono-lmlf,  per  cent- 
there  would  bo  nothing  absurd  in  the  plan. 
It  would,  indeed,  be  subject  to  the  fiital 
objection  that  the  currency  of  the  whole 
country  would  be  liable  to  suifer  from  any 
political  crisis  which  might  prevent  the 
payment  of  interest  on  the  bonds,  but  even 
then  the  currency  would  be  in  no  worse 
predicament  than  it  is  now. 

But  when  it  is  proposed  that  both  prin- 
dpal  and  interest  shall  be  payable  in  the 
very  currency  to  redeem  which  the  bonds 
are  issued,  it  is  very  hard  to  approach  the 
•abject  with  due  gravity.  Look  at  it  a 
moment.  You  have  your  pocketM  of 
greenbacks,  each  promising  to  pay  you  so 
many  dollars.  You  take  them  to  the  Treas- 
ury, and  ask  them  to  be  paid.  You  receive 
in  return  a  bond,  promising  "  United  StaUt 

will  pay  the  hauw dollar*,  teitk  inUrut 

at  3.65  ptr  cent,  per  aniiMSi."  You  go  for 
your  interest,  and  you  receive  greenbacks : 

"  UnUed  Statee  wUl  paj/  the  hearer &^^ 

Ion."  You  ask  for  your  principal,  and  you 
receive  the  very  same  old  formula.  Noth- 
ing are  you  ever  to  get  but  pai>er  stamped. 


^^ 


kSCK. 

Iialf,  per  cent— 
unl  in  the  plan, 
ict  to  the  fatal 
:y  of  the  whole 
suficr  from  any 
;ht  prevent  the 
bonds,  but  even 
be  in  no  worse 

that  both  prin- 
payable  in  the 
rhich  the  bonds 
to  approach  the 
Look  at  it  a 
r  pocketfhl  of 
5  to  pay  yoo  so 
em  to  the  Troas- 
id.  You  receive 
ig  "United  StaUn 
llar$,  with  intertat 
."  You  go  for 
live  greenbacks : 

I  ftMurer doU 

rincipal,  and  you 
formula.  Noth- 
;  paper  stamped, 


■ . 


TIIK  3.65-IIOMP  PLAN.  50 

'^UitUed  States  leill  pap  the  bearer dol- 

lar$."  You  can  only  choose  between  prom- 
ises with  interest  and  promises  without  in- 
terest ad  ii\/iHitHni,  the  interest,  you  must 
rumomber,  being  also  payable  in  promises. 
What  real  value  could  such  currency 
and  such  bonds  havef  As  we  have  al- 
ready seen,  the  value  of  bonds  and  notes 
of  every  kind  is  measured  by  tliat  of  the 
money  in  which  they  Kte  to  be  paid.  A 
bond  payable  in  pounds  sterling  is  worth 
more  than  one  payable  in  the  same  nnm- 
'ler  of  dollars,  because  the  pound  is  worth 
more  than  the  dollar.  A  bond  payable  in 
gold  dollars  is  worth  more  than  one  .pay- 
able in  paper  dollars,  in  the  proportion  that 
gold  is  worth  more  than  paper.  The  bondn 
being  payable  in  paper,  we  cannot  tell  the 
value  of  them  until  we  know  the  value  of 
the  paper  in  which  they  are  to  be  paid. 
But  we  find  that  the  value  of  the  paper 
depends  entirely  on  that  of  the  bonds,  be- 
cause the  notes  are  payable  in  nothing  but 
bonds.  Yon  can  exchange  notes  for  bonds, 
and  ric«  verea,  as  long  as  you  please,  but 
can  never  measure  the  value  of  either  ex- 


mma 


titm 


60 


TUB  ADO  OF  FINANCE. 


cept  by  trying  how  much  bread  and  meat 
it  will  buy  in  the  market 

The  principleB  on  which  this  ingenious 
system  of  finance  arc  lioscd  need  not  l)0 
confined  to  money;  they  can  also  bo  ap- 
plied to  navigation,  so  as  to  prevent  ship- 
wrecks. A  ship's  anchor  frequently  fails 
to  liold  her  in  a  storm,  and  she  may  thus 
be  driven  on  a  lee  shore.  Scores  of  vessels 
are  wrecked  in  this  way  every  year.  The 
new  plan  of  anchoring,  which  is  open  to 
the  world,  is  this :  dispense  with  all  such 
uncertain  things  as  anchors,  and  send  your 
ships  out  in  pairs.  Then,  whenever  your 
two  ships — the  Eagh  and  tho  Ocean  Wave — 
are  in  danger  of  being  blown  on  a  lee  shore 
in  a  gale  of  wind,  lash  the  Eagh  firmly  to 
the  Ooean  Wave,  so  that  the  wind  can't  move 
her  an  inch.  Then,  lash  the  Ocean  Wave 
firmly  to  the  Eagle,  so  that  she  cannot  move 
either.  Then  the  two  ships  will  bid  defi- 
ance to  the  storm,  and  their  crews  will  look 
on  calmly  as  they  see  those  unwise  captains 
who  trust  in  anchors  drifting  by  them. 
Tou  see  the  principles  involved.  The  ytagh 
is  the  greenback,  the  Oetan  Wari  the  bond. 


JS'fillSS^^" 


rANCB. 

bread  and  meat 

h  this  ingenious 
Hid  need  not  bo 
can  also  bo  ap- 
to  prevent  ship- 
■  frequently  fails 
nd  she  may  thus 
Scores  of  vessels 
Bvery  year.  The 
rhich  is  open  to 
se  with  all  such 
rs,  and  send  your 
I,  whenever  your 
the  Ocean  Wave — 
ivn  on  a  lee  shore 
le  Eagle  firmly  to 
I  wind  can*t  move 
1  the  Ocean  Wave 
she  cannot  move 
ips  will  bid  defi- 
ir  crews  will  look 
9  unwise  captains 
rifting  by  them, 
olved.  The,*eivle 
M  War^  the  bond. 


TIIK  3.65-DOMD  PLAN. 


61 


The  greenback  is  based  on  the  bond,  aa 
the  Eagle  is  lashed  to  the  Ooeaa  Wave.  The 
bond  is  based  on  the  greenback,  as  the 
Oeean  Wave  is  lashed  to  the  Eagle.  And 
thus  we  have  in  navigation,  as  in  finance,  a 
"subtle  principle,"  which  will  regulate  the 
movement  of  finance  and  of  ships  "  as  ac- 
curately as  the  motion  of  the  steam-engine 
is  regulated  by  its  governor." 

There  is  still  another  point  of  view  from 
which  it  is  worth  while  to  look  at  this  im- 
portant question.  We  have  already  had 
occasion  to  mention  the  fact,  which  every 
one  of  intelligence  knows,  that  the  money 
of  all  the  world  exchanges  exactly  accord- 
ing to  the  weight  of  gold  in  it,  and  accord- 
ing to  no  other  standard.  The  pound  ster- 
ling, for  instance,  exchanges  for  about  four 
dollars  and  eighty -five  cents  in  gold,  not 
because  cither  Congress  or  the  Bridah  Qov- 
enunent  ever  agreed  just  what  the  relative 
value  should  be,  but  because  there  is  as 
much  gold  in  one  pound  as  in  four  dollars 
and  eighty-five  cents.  Our  gold  dollar, 
again,  is  worth  four  German  marks,  because 
it  contains  that  many  times  the  quantity  of 


WW^*-*" 


68 


Toa  ABO  or  riXAMCK. 


gold.     But  on  the  new  lyttom  of  finance 
we  tre  to  ignore  the  gold  bult  entirely, 
and  our  paper  dollar  !•  to  have  absolute- 
Ij  nothing  in  common  with  the  gold  dollar 
except  the  name.    Does  it  seem  to  you  that 
this  paper  dollar,  which  has  nothing  to  do 
with  gold,  should  be  worth  twenty- three 
grains  of  gold  Just  because  in  former  gener- 
ations we  used  to  put  that  much  gold  in  a 
coin  of  the  same  namel    You  might  as 
well  thtak  that  if  Congress  would  only 
stamp  a  piece  of  paper  "  TMt  U  a  Iw^f  of 
Irwul,"  you  could  eat  and  digest  it    The 
Ikct  is,  there  is  no  more  reason  why  it 
should  bty  twenty-three  grains  of  gold  in 
the  markets  of  the  world  than  ten  grains 
or  one  gndn.    Its  purchasing  power  might 
begin  with  fifteen  or  twenty  grains,  but  it 
would  be  sure  to  sink  fh>m  year  to  year  to 
no  one  knows  where. 

Some  may  say.  What  difference  does  it 
make  to  me  how  much  gold  a  dolUr  will 
bay!  Let  thoae  who  want  gold  pay  th« 
market-price  for  it  I  answer  that  we  are 
to  consider  not  merely  the  quantity  of  gold 
which  the  paper  dollar  will  buy,  bat  the 


ANCE. 

^•tom  of  finance 
1  bails  entirely, 
>  have  absolute- 
I  the  gold  dollar 
iceni  to  yon  that 
18  nothing  to  do 
th  twenty- three 
in  former  gener- 
',  much  gold  in  a 
You  might  as 
rcM  would  only 
Tki*  <«  a  Utnf  of 
\  digest  it  The 
I  reason  why  it 
grains  of  gold  in 
.  than  ten  grains 
ling  power  might 
nty  grains,  but  it 
m  year  to  year  to 

lifference  does  it 
{old  a  dollar  will 
mt  gold  pay  the 
iswer  that  we  are 
9  quantity  of  gold 
will  buy,  bat  the 


■nut  MYOTBHY  09  MONBY. 


63 


quantity  of  flour,  beef;  and  shoes.  Wonld 
you  feel  perfectly  safe  in  binding  yourself 
to  give  forty  pounds  of  flour  or  three  hours' 
work,  a  year  hence,  to  any  one  who  would 
agree  to  give  you  in  exchange  a  piece  of 
paper  stamped  "One  Dollar"  by  act  of 
Ckingress  ?  If  you  ore  prudent,  you  certain- 
ly would  not. 


LESSON  IX. 

TUB  MYSTBBY  OP  MONET. 

When,  in  the  early  yea»f;  of  the  nreen- 
bocks,  our  statesmen  saw  gold  going  up  in 
the  market,  and  wished  to  explain  it  with- 
out supposing  a  depreciation  of  the  dollar, 
they  coined  a  word  to  express  their  tIcw 
of  the  matter,  and  said  gold  was  "  '..utciae- 
tized,"  and  turned  into  a  mere  article  of 
traffic,  like  leather  and  iron.  I  ailude  to 
this  notion  because  it  ia  baaed  on  a  very 
common  fidlacy  which  underlies  many  of 
our  aotiom  atioat  money.  This  fbllacy 
oonoista  in  supposing  that  by  being  used  aa 
a  medium  of  excha^  gold  becoires  i 


;  M 


mmm 


64 


THE  ADO  OF  IINANCB. 


ttted,  and  thereby  is  affected  with  aome 
mysterious  power  as  a  measure  of  value. 
We  see  this  fallacy  in  the  importance  some- 
times attached  to  the  question  what  is  and 
what  ia  not  money,  the  idea  being  that  if  a 
thing  is  money  it  is  very  different  fix>m 
what  it  would  be  if  it  were  cot  money.  In 
fact,  however,  anything  is  money  which 
people  universally  give  and  take  in  ex- 
change for  their  labor  or  merchandise. 
Salt,  cattle,  and  iron  have  been  used  as 
such.  In  our  colonial  times,  tobacco  was 
used  for  money,  and  clumsy  tiiough  it  was, 
it  was  far  better  money  than  the  bills  of 
credit  the  States  used  to  issue  with  such 
disastrous  effects.  Its  vse  as  money  did 
not  in  any  way  change  its  nature,  its  prop- 
erties, or  even  its  real  va^ue.  As  men  ad- 
vance in  civilization  thoy  find  that  these 
clumsy  things  will  no  longer  answer,  and 
take  to  gold  and  silver.  The  advantages 
of  the  pi?cious  metaU  are:  (1)  they  include 
a  great  value  ia  a  small  space;  (2)  they  are 
not  liable  to  decay  or  other  damage  fiom 
keeping;  (3)  they  can  be  divided  up  into 
snudl  and  definite  portions. 


1 
I 

<1 
c 
t 
C 
u 
t 
c 

s 

F 

u 

t 
1 

V 

n 
e 

S 

ti 
o 

8 
c 

8 


ted  with  wme 
laBure  of  valne. 
iportance  some- 
ion  what  is  and 
ibeing  that  if  a 

different  from 
cot  money.    In 

money  T^hich 
nd  take  in  ex- 
ir  merchandise. 
I  been  used  as 
es,  tobacco  was 
f  tiiough  it  was, 
lan  the  bills  of 
issue  with  such 
I  as  money  did 
nature,  its  prop- 
le.  As  men  ad- 
find  that  these 
ger  answer,  and 
The  advantages 
(1)  they  include 
tee;  (2)  they  are 
er  damage  fiom 
divided  up  into 


THE  MYSTEUY  Or  MONET. 


65 


Gold  in  its  crude  state,  entirely  uncoined, 
was  very  recently  in  use  as  money  in  some 
parts  of  California  and  Mexico.  But  the 
difSculty  of  being  sure  of  the  weight  and 
quality  of  the  metal  is  a  serious  evil  in  such 
cases ;  80  at  a  very  early  stage  in  civiliza- 
tion governments  step  in  and  coin  the  gold. 
Coinage,  as  we  have  already  explained,  has 
no  other  value  than  that  of  a  certificate  of 
the  quantity  and  fineness  of  the  gold  in  the 
coin. 

Thus  far  there  is  no  mystery.  A  coin  is 
simply  so  much  gold  or  silver,  which  peo- 
ple pass  from  hand  to  hand  as  the  Indians 
used  to  pass  wampum,  and  the  colonists 
tobacco.  The  next  step  is  the  use  of  credit 
paper.  In  any  mercantile  community  it 
would  soon  be  found  that  there  was  no 
need  of  actually  counting  out  the  coin  for 
every  payment,  and  that  trouble  and  dan- 
ger of  loss  would  be  avoided  by  keeping 
the  gold  in  a  bank,  and  paying  over  checks 
or  bills  entitling  the  holder  to  so  much 
gold  at  the  bank.  As  every  owner  of  a 
check  could  go  to  the  bank  and  get  the 
gold  if  he  wanted  it,  they  are  just  as  valn- 
5 


66  THE  ABC  OF  FINANCE. 

able  as  the  gold  itself.   We  might  thus  im- 
agine all  the  money  of  a  community  kept 
in  one  bank,  and  all  payments  made  by 
checks  on  the  bank.    The  gold  would  then 
lie  there  in  the  vaults  year  after  year,  dis- 
turbed only  when  some  one  required  it, 
from  time  to  time,  to  send  away,  or  to  melt 
into  some  useful  article.    The  bank  would 
also  have  to  be  paid  for  the  expense  of 
keeping  the  gold  and  paying  the  checks. 
To  avoid  this,  the  modern  banking  system 
is  introduced,  by  which  the  bank  is  allow- 
ed to  loan  part  of  the  gold  out  at  inter- 
est for  short  periods,  and  thus  compensate 
itself  by  the  interest  it  receives.    It  still 
holds  itself  responsible  to  pay  every  one 
who  wants  it  his  gold  on  demand ;  and  as 
long  as  the  confidence  of  the  business  com 
munity  is  maintained,  it  can  do  this  with 
perfect  safety.   It  may  have  credits  out, pay- 
able on  demand,  to  three  or  four  times  the 
amount  of  gold  in  its  vaults ;  but,  unless  an 
extraordinary  number  of  depositors  should 
rush  after  their  gold  at  once,  all  demands 
can  be  satisfied.    Unless  a  panic  occurs, 
there  is  no  more  danger  of  this  than  of  ev- 


ITANCK. 


THE  MYSTERY  OF  MONEY. 


C7 


e  might  thus  im- 
cominuuity  kept 
rmcnts  made  by 
gold  would  then 
ir  after  year,  dis- 
one  required  it, 
Rway,  or  to  melt 
The  bank  would 
the  expense  of 
ying  the  checks. 
\  banking  system 
he  bank  is  allow- 
old  out  at  inter- 
thus  compensate 
receives.    It  still 

0  pay  every  one 
,  demand ;  and  as 
the  business  com 
can  do  this  with 
re  credits  out,pay- 

1  or  four  times  the 
Us;  but, unless  an 
depositors  should 
once,  all  demands 
3  a  panic  occurs, 
of  this  than  of  ev- 


ery one  wearing  out  his  shoes  at  once,  and 
besieging  the  shoe-stores  on  the  same  day 
for  a  new  pair.  Even  then  the  worst  that 
can  happen  to  the  holder  of  the  note  is 
having  to  wait  a  few  days  for  his  money. 

Such  is  the  history  of  money,  in  brief. 
It  is  simply  a  commodity  like  gold,  or  a 
paper  certificate  entitling  the  holder  to  a 
commodity.  Seeing  these  paper  certificates 
pass  from  band  to  hand,  with  6nly  one  man 
in  a  hundred  going  to  get  the  gold  to 
which  they  entitle  him,  people  of  wild 
ideas  are  constantly  jumping  to  the  conclu- 
sion that  they  need  not  entitle  the  holder 
to  anything,  and  that  a  stage  of  progress 
may  be  reached  in  which  mere  stamped 
paper  will  answer  the  purpose  of  money. 
The  plans  for  attaining  this  eud  are  as  nu- 
merous and  as  chimerical  as  tho.ie  for  at- 
taining perpetual  motion.  One  mi  ^ht  with 
equal  reason  claim  that  the  human  race 
would  reach  a  state  of  things  in  which  such 
gross  food  as  bread  and  beef  would  no 
longer  be  necessary,  and  people  would  lire 
entirely  on  ideas. 


ABO  or  FIXAKCB. 


LESSON  X. 

THE  ETIL  OF  A  DBFRECIATINO  CrRBENCT. 

At  this  stage  the  reader  may  ask,  What 
harm  if  the  currency  does  depreciate? 
What  difference  whether  it  takes  two  or 
two  dozen  paper  dollars  to  buy  a  pair  of 
shoes,  so  long  as  they  pass  current  ?  To 
answer  this  question  fully  would  require 
ine  to  write  a  large  book.  The  history  of 
mankind  for  the  last  two  centuries  is  full 
of  examples  showing  that  a  depreciating 
currency  is  the  greatest  source  of  injury  to 
the  business  of  a  nation,  being  nothing  less 
than  a  national  calamity.  A  brief  sum- 
mary of  the  most  obvious  evils  is  all  we 
now  have  time  for. 

1.  People  are  constantly  bargaining  for 
the  sale  of  their  goods  or  their  services  in 
exchange  for  a  certain  number  of  dollars, 
to  be  paid  them  at  some  future  time.  Sal- 
aried men  and  laborers  engage  thenuelves 
by  the  day,  the  month,  or  the  year.  Eco- 
nomical people  put  money  in  the  savings- 


AKCB. 


TISO  CURBENCT. 

■  may  aak,  What 
oes  depreciate  ? 
it  takes  two  or 
:o  buy  a  pair  of 
ss  current?  To 
f  would  require 
Tlie  history  of 
centuries  is  full 
t  a  depreciating 
urce  of  injury  to 
3ing  nothing  less 
.  A  brief  snm- 
8  evils  is  all  we 

y  bargaining  for 
their  services  in 
imber  of  dollars, 
iiture  time.  8al- 
igage  themaelres 
r  the  year.  Eco- 
j  in  the  savings- 


EVIL  OF  A  DEPRKCIATIHO  CUBHEXCY.  69 

bank,  to  be  repaid,  perhaps,  a*'  the  end  of 
many  years.  All  these  arrangements  are 
made  under  the  belief  that  the  dollars  you 
are  going  to  receive  will  buy  you,  on  the 
average,  as  many  of  the  means  of  living  as 
they  will  now.  If  you  are  to  be  paid  in 
gold  dollars,  you  may  be  morally  certain 
that  your  expectations  in  this  respect  will 
be  fulfilled,  because  the  experience  of  man- 
kind in  all  ages  has  shown  that  the  pur- 
chasing power  of  gold  is  never  subject  to 
great  and  rapid  fluctuations.  But  if  you 
are  to  be  paid  in  paper  dollars,  no  man 
knows  what  they  will  buy.  The  laborer 
will  find,  week  after  week,  that  prices  rise 
so  fast,  his  wages  will  buy  less  and  less  for 
his  family.  If  the  policy  is  once  adopted 
to  issue  all  the  paper  dollars  that  may  be 
required  by  commerce,  it  is  not  only  pos- 
sible, but  highly  probable,  that  thirty  of 
them  would  not,  twenty  years  hence,  buy  a 
decent  meal.  See  scale  of  prices  in  Hayti, 
for  example,  where  this  policy  has  been 
adopted.  What  docs  the  proposed  paper- 
money  bond  amount  to  ?  It  will  say  that 
the  United  States  will  pay  the  bearer  one 


iJHIiWilllll 


70 


THE  ABC  OF  FCfAXCE. 


hundred  dollars.    What  does  this  mean, 
on  the  new  plan  ?    Simply  this : 

On  demand  the  United  Statu  promiaea  to 
print  and  stamp  far  the  hearer  one  hundred  pa- 
per doUari,  and  does  hereby  guarantee  that  the 
said  papers  shall  he  called  dollars  everywhere  in 
this  country. 

If  the  United  States  also  guaranteed  that 
these  dollars  should  buy  some  specified 
portion  of  the  necessaries  of  life  —  forty 
pounds  of  flour,  or  eight  pounds  of  beef, 
for  example — the  promise  might  amount 
to  something.  But  when  all  reason  and 
all  experience  show  that  the  paper  dollars 
will  probably  lose  nearly  all  power  of  pur- 
chasing, who  will  agree  to  take  them  ?  Is 
it  right  for  the  Government  to  adopt  a  pol- 
icy which  will  end  in  the  bitter  deception 
of  all  its  citizens  who  do  not  know  the  dif- 
ference between  gold  and  paper  dollars  ? 

2.  The  second  evil  of  depreciating  paper 
is,  that  it  necessarily  enriches  speculators 
at  the  expense  of  the  rest  of  the  commu- 
nity. The  sharp  speculator  is  no  theorist. 
He  knows  exactly  what  the  eflfect  of  de- 
preciating paper  is,  and  takes  advantage 


LXCE. 


mean. 


963  this 
this : 

tttea  promitet  to 
■  one  hundred  pa- 
uarantee  that  the 
ars  everywhere  in 

Tuaranteed  that 
some  specified 

of  life  — forty 
M)und8  of  beef, 

might  amount 

all  reason  and 
le  paper  dollars 
ll  power  of  pur- 
take  them  ?    Is 

to  adopt  a  pol- 
bitter  deception 
»t  know  the  dif- 
)aper  dollars  ? 
predating  paper 
;he8  speculatora 

of  the  commu- 
T  is  no  theorist, 
he  eflFect  of  de- 
takes  advantage 


EVIL  Ol'  A  DEPBECUTINO  CURllENCY.  71 

of  it.  He  buys  goods  on  credit,  and  holds 
them  until  their  prices  rise,  then  sells  them, 
and  pays  off  his  debt  with  a  part  of  the 
proceeds,  pocketing  the  balance  as  profits 
of  the  operation.  Of  course  great  business 
activity  is  thus  produced.  The  manufac- 
turer hires  operatives  at  present  prices,  well 
knowing  that  the  goods  they  produce  will 
rise  on  his  hands  so  as  to  yield  him  a  hand- 
some profit.  The  operatives  receive  their 
pay  in  depreciated  dollars,  and  are  the  real 
sufferers. 

8.  The  third  evil  is,  that  extravagance 
is  fostered.  Sudden  fortunes  are  made  by 
speculation,  while  no  one  really  feels  «ny 
poorer.  The  salaried  man  finds  it  hftrd  to 
make  both  ends  meet;  but,  as  he  gets  his 
usual  income,  he  must  not  complain  of  the 
high  prices.  Property  of  all  kinds  rising 
in  price,  property- holders  are  at  first  very 
much  pleased.  They  do  not  clearly  see 
that  the  rise  is  due  to  the  fact  that  the  dol- 
lars by  which  the  value  is  estimated  are 
worth  less  than  before.  They  arc  much  in 
the  position  of  a  man  who,  having  a  hand- 
ful of  gold  dollars,  should  be  fumished 


mMMMMMHCM^i^l 


78 


THE  ABC  OF  FINANCE. 


vrhh  a  pair  of  gpectacles  which  made  ct* 
ery  dollar  look  liko  an  eoglc,  and  who, 
therefore,  thinks  he  has  suddenly  increased 
his  wealth  ten  times.  If  ho  is  a  good- 
hearted  man,  he  spends  some  of  his  sur- 
plus in  giving  a  feast  to  all  his  friends, 
and  this  is  done  by  so  many  that  wo  have 
almost  an  era  of  extravagance.  Of  course 
the  extravagance  bos  to  be  bitterly  paid 
for. 

4.  The  fourth  evil  of  depreciating  cur- 
rency is,  that  it  aggravates  the  very  evil 
which  it  is  designed  to  prevent,  not  only 
by  making  the  rate  of  interest  higli,  but 
by  making  it  almost  impossible  to  borrow 
money  on  ony  terms  whatever.  This  may 
seem  paradoxical,  but  it  is  a  fact  well 
proved  by  the  bitter  experience  of  those 
unfortunate  people  who  have  been  attract- 
ed by  the  song  of  the  paper- money  siren. 
There  are  two  reasons  for  this  effect.  One 
is,  that,  owing  to  the  enormous  nominal 
prices  to  which  all  goods  mount  under  a 
system  of  depreciated  paper  money,  more 
money  is  required  to  transact  the  business 
of  the  country  just  in  proportion  as  more 


/INCE. 


EVIL  OF  A  DEPRECIATING  CURRBXCY.  73 


rliicli  made  ct* 
iogle,  and  who, 
idenly  increased 
ho  is  a  good- 
}nie  of  his  sur- 
all  his  friends, 
ly  that  wo  have 
nee.  Of  course 
10  bitterly  paid 

spreciating  cur- 
3  the  very  evil 
'event,  not  only 
terest  high,  but 
si  bio  to  borrow 
iver.  This  may 
is  a  fact  well 
rionco  of  those 
70  been  attract- 
er- money  siren, 
his  effect.  One 
irmous  nominal 
mount  under  a 
er  money,  more 
ict  the  businesa 
•ortion  as  more 


is  issued.  When  everything  costs  twice 
what  it  now  docs,  you  must  take  twice  as 
much  money  in  your  pocket  when  you  go 
on  a  journey  or  make  a  purchase ;  and  you 
would,  from  this  cause  alone,  find  money 
just  as  scarce  as  before.  If  your  wife  wants 
two  or  three  hundred  dollars  every  timo 
she  goes  shopping,  you  need  a  largo  pile  of 
money.  But  the  principal  reason  is,  that 
tho  constant  rise  in  prices  stimulates  bor- 
rowing for  the  purpose  of  speculation,  as 
just  explained.  When  a  largo  number  of 
people  are  anxious  to  borrow  all  the  money 
that  can  l)e  had,  and  willing  to  pay  a  high 
rate  of  interest  for  it,  money  to  borrow 
must  be  scarce.  When  every  one  is  anx- 
ious to  buy,  and  wants  to  borrow  all  the 
money  he  can  get  to  buy  with,  a  competi- 
tion must  send  up  the  rate  of  interest. 

All  this  is  little  more  than  history  in 
brief.  If  tho  reader  requires  further  de- 
tails, he  must  read  the  financial  history  of 
the  French  Revolution,  of  the  American 
colonies,  of  our  own  Revolution,  and  of 
business  and  gold  speculation  during  the 
early  years  of  our  civil  war.    Indeed,  I  can 


74 


THE  ADC  OF  FINANCE. 


hardly  conceive  of  a  reasonable  man  read- 
ing these  histories,  and  remaining  a  believ- 
er in  irredceninblo  paper  nioncy,  any  more 
than  I  can  conceive  of  his  wanting  to  drive 
across  a  ricketty  bridge  after  knowing  that 
every  heavy  vehicle  which  ever  tried  to 
cross  it  had  fallen  through  and  liecn  de- 
stroyed. As  very  few  of  my  roiulera  will 
have  time  to  consult  these  histories,  I  shall 
try,  in  a  subsequent  lesson,  to  give  an  idea 
of  what  they  are.  To  those  who  desire  to 
inform  themselves  farther,  I  commend  such 
books  as  Gouge's  "  Short  History  of  Paper 
Money  nnd  Banking  in  the  United  States," 
Sumner's  "  History  of  American  Currency," 
and  the  financial  chapters  of  Thiera'a  "  His- 
tory of  the  French  Revolution." 

When  reason  and  history  unite  in  show- 
ing Buch  sprious  evils  as  the  result  of  de- 
preciating c.rrency,  and  no  fruits  but  such 
as  turn  to  bitter  ashes  in  the  month,  what 
shall  we  Huy  to  those  ignorant  or  visiona- 
ry men  who  promise  a  millennium  under  a 
paper-money  system,  telling  you  that  there 
Bhall  be  no  more  panics  and  no  more  scarci- 
ty of  moD'.y  ? 


UNCB. 

lable  man  rcad- 
aining  a  bclicv- 
loney,  any  more 
,'nnting  to  drive 
}r  knowing  that 
1  ever  tried  to 
li  and  lieon  de- 
ny roiulera  will 
histories,  I  shall 
to  give  an  idea 
e  wl)o  desire  to 
[  commend  such 
listory  of  Poper 
United  States," 
•ican  Currency," 
»f  Thiers'a  "  Uis- 
ion." 

y  unite  in  sliow- 
he  result  of  de- 
)  fruitH  but  sucli 
the  month,  what 
irant  or  visiona- 
lennium  under  a 
g  you  that  there 
ino  more  Bcarci- 


A  FKW  FACTO.  W 


LESSON  XI. 

A    PEW    FACTS. 

It  is  very  comm'  ',  in  discussions  of  sub- 
jects like  this,  to  call  for  "facts,"  many 
people  thinking  that  a  single  fact  is  worth 
bushels  of  reasoning.  Whether  this  opin- 
ion is  well  or  ill  founded,  there  is  nothing 
which  the  advocotcs  of  inflation  so  careful- 
ly conceal  as  the  well-known  facts  of  the 
history  of  money.  Wendell  Phillips,  for 
instance,  is  credited  with  saying  that  spe- 
cie payments  mean  specie  when  you  do  not 
want  it,  and  nothing  but  paper  when  you  'J 

do.  No  better  illustration  of  the  wildness 
with  which  such  men  talk  can  be  given 
than  merely  putting  this  statement  along- 
side of  facts.  These  facts  are  such  as  no  in- 
flationist will  have  the  hardihood  to  deny, 
however  much  he  may  try  to  explain  them 
away,  and  they  are  worthy  of  being  care- 
fully borne  in  mind. 

Fir$t  Fact.— For  fifty  years  past  there  has 
not  been  a  day  when  an  owner  of  on  English 


70 


TtIK  ABC  or  riKANCI. 


bank-note  could  not  get  it  paid  In  gold,  nor 
is  it  likely  that  such  a  c|ay  will  bo  scon  for 
five  hundred  years  to  come.  Nor  has  there, 
in  all  probability,  been  a  business  day  "t 
the  banks  when  one  or  more  persons,  and 
generally  dozens  or  hundreds  of  them,  did 
not  want  gold.  Hardly  a  business  day 
now  passes  in  which  the  Bank  of  England 
doca  not  pay  out  gold  to  the  amount  of 
tens  or  even  hundreds  of  thousands  of  dol- 
lars, to  people  wanting  it.  Remember  this 
when  you  read  or  hear  that  specie  pay- 
ment* cannot  be  kept  up  on  the  limited 
supply  of  gold  now  available.  In  thus 
talking  as  if  there  were  some  great  diffi- 
culty in  keeping  paper  always  redeemable, 
and  08  if  a  suspension  every  twenty  years 
was  a  matter  of  course,  people  bear  in  mind 
only  the  experience  of  our  comparatively 
weak  banks,  and  do  not  look  at  the  reason 
of  the  thing.  In  the  fact  that  the  Bank  of 
Enghind  has  never  suspended  specie  ])ay- 
ment,  or  thought  of  suspending,  for  a  day 
since  1822,  we  have  an  example  much  more 
worthy  of  imitation.  Having  gone  on  so 
succeufblly  for  two  entire  generations,  the 


laid  In  gold,  nor 
will  bo  scon  for 
Nor  has  thoro, 
business  day  "t 
ire  persons,  and 
[Is  of  thcni,  did 
I  business  day 
ink  of  England 
the  amount  of 
ousands  of  dol- 
Remcmbcr  this 
lat  specie  pay- 
on  the  limited 
able.  In  thus 
ime  great  diffi- 
lys  redeemable, 
ry  twenty  years 
tie  bear  in  mind 
■  comparatively 
>k  at  the  reason 
lat  the  Bank  of 
led  specie  ])ay> 
ding,  for  a  day 
iple  much  more 
ng  gone  on  so 
;eneration8,  the 


A  FEW  FACTS. 


77 


goTemors  of  that  institution  would  now 
almost  OS  soon  think  of  committing  suicide 
aa  of  suspending. 

Second  fact.— Under  this  \w\\cj  of  con- 
stant adherence  to  specie  redemption,  the 
little  island  of  Great  Britain  has  maintain- 
ed the  oommercial  supremacy  of  the  world. 
London  has  become  its  great  monetary 
centre,  and,  in  spite  of  her  system  of  land 
tenure  and  other  institutions  which  tend 
to  the  disadvantage  of  her  poorer  classes, 
the  average  laborer  of  England  is  better 
off  than  that  of  any  other  country  in  Eu- 
rope. « 

Third  Fact. — There  is  no  case  recorded 
in  history  of  a  government  issuing  paper 
money  not  redeemable  in  gold  or  silver, 
and  in  quantities  sufficient  for  commerce, 
without  that  paper  money  depreciating.' 
The  cases  of  such  attempts  and  of  their 
failure  are  so  numerous  tliat  a  whole  vol- 
ume of  history  would  be  required  to  re- 
count them. 

FoHftk  liVwI.— There  is  now  twice  as  much 
paper  currency  per  capita  of  our  population 
as  during  the  six  years  preceding  our  civil 


^ 


iwwiiwmgi»..iiniWl 


78 


THE  ABC  OF  FINANCE. 


war.  Between  1854  and  1861,  the  total 
bank  circulation  averaged  between  one 
hundred  and  ninety  and  two  hundred  mill- 
ions; Now,  including  our  legal  tenders 
and  national  bank-notes,  it  is  not  far  from 
six  hundred  millions.  Without  aiming  at 
any  useless  refinement  in  numbers,  we  may 
say,  in  a  general  way,  that  we  have  no\v^ 
50  per  cent,  more  population,  and  three 
times  ae  much  paper  currency,  as  between 
1854  and  1861.  Therefore,  it  cannot  be 
from  any  want  of  currency  that  we  are  suf- 
fering. 

If  you  tell  these  facts  to  an  inflationist, 
he  may  denounce  them  vigorously,  and 
complain  that  you  remember  them,  and  say 
they  have  nothing  to  do  with  present  ques- 
tions ;  but  he  will  not  dare  to  deny  them 
unless  he  cares  nothing  for  truth.  There 
is,  however,  one  deception  against  which 
you  must  be  on  your  guard.  The  Govern- 
ment  of  England  has,  on  several  occasions, 
when  there  was  a  great  pressure  for  mon- 
ey in  London, "  suspended,"  temporarily,  a 
certain  clause  in  th  banking  law  which 
prohibits  the  Bank  of  England  from  issa- 


.XCE. 

[801,  the  total 
between  one 
» hundred  mill- 
legal  tenders 
is  not  far  from 
liout  aiming  at 
imbers,  we  may 
we  have  nu\\r 
ion,  and  three 
icy,  as  between 
!,  it  cannot  be 
haX  we  are  suf- 


THB  LESSONS  OF  HISTOUY. 


79 


tag  not<^  \vhen  its  supply  of  specie  falls 
below  a  tortain  limit,  and  a  class  of  infla- 
tionista  frequently  try  to  deceive  those  of 
their  hearers  who  are  not  acquainted  with 
financial  history  by  talking  as  if  this  were 
a  suspension  of  specie  payment.  Really, 
this  suspension  is  only  apermitsion  to  iwue 
notes,  of  which  the  Bank  would  not  think 
of  availing  itself,  if  there  were  any  serious 
danger  of  having  to  refuse  theur  redemp- 
tion. 


an  inflationist, 
igorously,  and 
r  them,  and  say 
h  present  ques- 
I  to  deny  them 
r  truth.  There 
against  which 
,  The  Govem- 
reral  occasions, 
essure  for  mon- 
'  temporarily,  a 
ing  law  which 
land  from  issa- 


LEssoN  xn. 

THE  LESSONS  OF  HISTOBT. 

To  compress  anything  like  a  history  into 
a  single  chapter  is,  indeed,  extremely  diffi- 
cult. Still,  there  are  certain  general  and 
universal  features  in  the  history  of  paper 
money,  both  in  this  and  other  countries, 
which  are  too  instructive  to  be  neglected. 
To  understand  what  those  features  are, 
we  must  revert  to  soine  ideas  set  forth  in 
Lesson  IV.,  viz.,  that  the  words  "  dollar," 
"pound,"  etc.,  are  mere  names  of  some 


80 


THE  ABC  OF  FIXAKCE. 


tangible  thing ;  and  that  if  the  things  to 
which  those  names  attach  differ  from  each 
other,  the  fact  that  they  are  called  by  the 
same  name  does  not  give  them  any  com- 
mon value.  It  is  said  that  in  one  period 
of  Roman  liistory  the  Oauls  had  to  pay  a 
certain  monthly  tribute  to  the  Romans, 
and  that  one  of  the  governors  of  Gaul  or- 
dered that  the  year  should  be  divided  into 
fourteen  months,  in  order  that  the  Gauls 
should  thus  be  compelled  to  pay  a  greater 
amount  of  tribute  in  the  course  of  a  year. 
The  meaning  of  the  words  in  a  contract 
was  thus  altered  after  the  contract  had 
been  made,  in  order  that  it  might  mean 
something  different  from  what  the  parties 
originally  intended.  This  kind  of  legal 
fraud  is  so  obvious,  and  so  repulsive  to  ev- 
ery sentiment  of  honor  in  the  mind  of  man, 
that  it  can  never  be  practised  except  when 
the  alteration  in  the  meaning  of  words  is 
not  apparent.  The  only  case  in  which 
people  can  be  readily  imposed  on  by  such 
alteration  is  that  of  money ;  and  the  great 
feature  of  the  history  of  money,  especially 
paper  money,  to  which  I  wish  to  call  at- 


FAKCE. 

if  the  things  to 
differ  from  each 
re  called  by  the 

them  any  com- 
it  in  one  period 
lis  had  to  pay  a 
bo  the  Romans, 
nors  of  Gaul  or- 

be  divided  into 
'  that  the  Gauls 
to  pay  a  greater 
;ourse  of  a  year. 
Lis  in  a  contract 
ic  contract  had 

it  might  mean 
(vhat  the  parties 
IS  kind  of  legal 

repulsive  to  ev- 
he  mind  of  man, 
Bed  except  when 
ling  of  words  is 

case  in  which 
osed  on  by  such 
f ;  and  the  great 
Qoney,  especially 
wish  to  call  at- 


TUB  LESSONS  OF  HISTORY. 


81 


toition,  is  the  manner  in  which  words  ex- 
pressing value,  such  as  "dollar,"  "shil- 
ling," "pound,"  "florin,"  "mark,"  etc., 
were  made  to  express  different  degrees  of 
real  value  at  different  times,  in  order  to 
meet  the  supposed  exigencies  of  the  hour. 

We  scarcely  know  when  this  kind  of 
fraud  began.  It  is  said  that  the  Roman 
Emperor  Elagabalus,  being  entitled  to  re- 
ceive annually  from  his  subjects  a  certain 
number  of  pieces  of  gold,  each  of  which 
pieces  was  called  an  aureus,  cunningly  in- 
creased the  amount  of  gold  in  this  coin  so 
that  they  had  to  pay  him  more  than  they 
bargained  for.  The  history  of  England  in 
its  earlier  stages  aff:>rd8  many  instances  in 
which  the  cheat  was  in  the  opposite  dbec- 
tion.  It  has  been  no  new  thing,  when  a 
king  of  England  found  hiraself  heavily  in 
debt,  to  diminish  the  amount  of  silver  in 
the  pound  sterling,  in  order  that  the  debt 
might  be  morp  easily  discharged.  From 
the  Norman  Conquest  until  the  reign  of 
Edward  the  Third,  the  pound  sterling  con- 
tained a  pound  of  silver.  It  has  now  less 
than  one-third  of  its  original  value ;  itiai 
6 


82 


THE  ABC  OF  FINANCE. 


is,  a  pound  silver  is  now  worth  more  than 
three  pounds  sterling.  In  Scotland  the 
practice  was  carried  still  farther.  The 
house  of  Stuart,  in  a  century  and  a  half, 
reduced  the  quantity  of  silver  in  the  pound 
to  less  than  one -twentieth  of  its  original 
amount  '  This  kind  of  fraud  was  just  as 
mean  as  if  the  kings  had  owed  their  sub- 
jects a  certain  number  of  yards  of  cloth, 
and  had  then  by  royal  decree  made  a  yard- 
measure  shorter,  in  order  that  they  might 
more  easily  discharge  their  debts.' 

In  the  times  which  we  have  described, 
paper  money  was  almost  unknown.  A  few 
centuries  ago  it  was  gradually  discovered 
by  bankers  that  a  bill  of  credit  in  any  form 
whatever,  entitling  the  holder  to  a  certain 
amount  of  gold  in  a  bank,  would  pass  from 
hand  to  hand  as  money  just  as  readily  as 
the  coin  itself  As  this  sort  of  currency 
had  some  advantages  over  gold,  and  could 
be  made  profitable  to  the  bankers,  the  pa- 
per-money system  of  the  present  time  was 
gradually  introduced  into  nearly  all  civil- 
ized countries.  Then  arose  the  delusion, 
the  exposure  of  which  is  one  of  the  objects 


7ANCE. 

rortb  more  than 
[n  Scotland  the 
I  farther.  The 
tury  and  a  half, 
rer  in  the  pound 
h  of  its  original 
and  was  just  as 
owed  their  sub- 
r  yards  of  cloth, 
ree  made  a  yard- 
that  they  might 
r  debtsr 
have  described, 
[uknown.  A  few 
lually  discovered 
redit  in  any  form 
tlder  to  a  certain 
would  pass  from 
ust  as  readily  as 
sort  of  currency 
r  gold,  and  could 
bankers,  the  pa- 
present  time  was 
»  nearly  all  civil- 
9se  the  delusion, 
one  of  the  objects 


THR  LESSONS  OF  HISTORY. 


83 


I 


of  these  lessons,  viz.,  that  because  these 
pieceb  of  paper  passed  from  hand  to  hand 
without  being  immediately  returned  to  the 
bank  for  the  gold  to  which  they  entitled 
the  bearer,  it  was  not  necessary  that  thty 
should  entitle  the  bearer  to  anything.  It 
was  thought  that  if  the  Government  would 
only  declare  these  papers  to  be  themselves 
pounds,  florins,  dollars,  marks,  piastres, 
etc.,  they  would  be  just  as  valuable,  and 
would  take  the  place  of  these  several  coins. 
A  regard  for  common -sense  and  honesty 
has,  however,  prevented  this  policy  from 
being  carried  out  except  under  two  condi- 
tions. One  of  these  conditions  is  that  of 
such  gross  ignorance  of  political  economy 
on  the  part  of  the  public  that  they  think 
there  must  be  some  real  connection  be- 
tween the  value  of  these  pieces  of  paper 
and  that  of  the  coins  called  by  the  same 
name.  The  other  condition  is  that  of  the 
Govemmettt  failing  to  collect  sufficient  rev- 
enue to  meet  its  expenses,  and  thus  being 
driven  to  pay  these  expenses  by  issuing 
paper  money  to  its  creditors.  A  Qovem- 
mont  having  the  power  to  make  its  issuea 


84 


THE  ABC  OF  FINANCE. 


itP 


a  legal  tender  can  get  along  for  a  while 
without  revenue  by  paying  its  expenses 
in  this  kind  of  money;  and  if  the  Govern- 
ment is  a  weak  one,  engaged  in  war,  the 
temptation  to  this  policy  is  especially 
strong. 

Among  our  earliest  colonists,  the  first  of 
these  conditions  was  completely  fulfilled. 
To  say  th^t  they  knew  nothing  of  politi- 
cal coor  >my  is  not  a  reproach  to  them,  be- 
cause such  a  science  did  not  then  exist. 
The  delusion  that  value  depended  in  some 
way  upon  the  stamp  or  word  of  the  Gov- 
ernment, and  not  on  the  desire  of  men  to 
possess  useful  things,  bad  a  strong  hold 
on  the  minds  of  men  everywhere.  There 
was  so  little  specie  in  the  colonies  that  a 
resort  to  some  substitute  seemed  an  abso- 
lute necessity;  and  the  most  convenient 
substitute  of  all  was  the  issue  of  bills  of 
credit  by  the  several  colonial  governments, 
because  these  bills  cost  the  governments 
nothing  but  the  expense  of  printing,  and 
could  be  used  to  pay  out  to  the  public 
creditors.  Ingenious  as  are  the  projects 
now  afloat  for  thu  issue  of  paper  money,  I 


[ANCE. 

ong  for  a  while 
ng  its  expenses 
id  if  the  Govera- 
igcd  in  war,  the 
3y  is  especially 

nists,  the  first  of 
ipletely  fulfilled, 
othing  of  politi- 
lach  to  them,  be- 
not  then  exist, 
epended  in  some 
rord  of  the  Gov- 
desire  of  men  to 
1  a  strong  hold 
rywhero.  There 
i  colonies  that  a 
seemed  an  abso- 
most  convenient 
issue  of  bills  of 
lial  govomments, 
the  governments 
of  printing,  and 
at  to  the  public 
are  the  projects 
f  paper  money,  I 


THE  LE8S0K8  OF  mSTORY. 


85 


do  not  believe  there  is  one  which  you  will 
not  find  to  have  been  tried  during  those 
times,  and  to  have  proved  a  total  fiskilure. 
The  amount  of  money  afloat  was  increased 
and  diminished  without  any  regard  to  the 
wants  of  commerce,  and  thus  the  most  dis- 
astrous fluctuations  in  its  value  were  pro- 
duced ;  so  that  no  one  who  had  to  pay  a 
debt  of  five  pounds  could  say,  two  or  three 
years'  in  advance,  what  the  value  of  the 
pounds  would  be  at  that  time.  Our  col- 
onists tried  notes  with  interest,  and  notes 
without  interes";;  notes  issued  to  pay  their 
expenses,  and  notes  Issued  as  a  loan  on  se- 
curity; but  the  resu  c  was  always  the  same. 
The  more  they  were  :ssued,  the  more  they 
were  depreciated,  the  i"ieasure  of  this  de- 
preciation being  the  ris3  in  the  price  of 
silver.  As  they  depreciated,  they  drove 
what  little  silver  currency  there  was  from 
the  colonies,  and  it  did  not  return  until  the 
notes  were  withdrawn. 

The  most  well  known  of  these  paper- 
money  systems  was  that  of  the  Continental 
Congress,  known  as  "Continental  money." 
The  first  issue  of  these  notes,  to  the  amoant 


86 


THE  ABO  OF  nNA3«CK. 


of  six  millions,  was  made  in  177S.  They 
were,  perhaps,  the  nearest  approach  on  rec- 
ord to  the  ideal  paper  money  for  which  our 
greenback  friends  are  now  wishing.  They 
were,  in  fact,  simple  certificates  that  the 
bearer  thereof  was  erHtled  to  a  certain 
number  of  Spanish  milled  dollars,  without 
any  statement  as  to  when  or  how  he  was 
ever  going  to  get  these  dollars.  They  bore 
no  interest ;  they  were  not  convertible  into 
coin  or  any  kind  of  bonds ;  they  were  not 
secured  by  anything  at  all.  The  only  point 
in  which  they  failed  to  conform  to  the 
ideal  greenback  of  the  future  was,  that  in- 
stead of  being  declared  "  dollars  "  pure  and 
simple,  the  words  "  Spanish  milled  dollars  " 
were  used.  After  the  issue  exceeded  a  cer- 
tain limit,  the  inevitable  process  of  depre- 
ciation commenced.  It  continued  slowly, 
but  regularly,  throughout  the  whole  Revo- 
lutionary War.  Every  &11  in  the  value  of 
the  paper  necessitated  larger  and  larger  is- 
sues, until,  finally,  two  hundred  millions  of 
it  were  in  circulation,  and  all  hope  of  re- 
demption vanished.  It  might  have  been 
supposed  that  when  the  war  closed,  and 


iASfCE, 

in  1775.  They 
approacb  on  rec- 
ley  for  which  our 
wishing.  They 
ficates  that  the 
ed  to  a  certain 
dollars,  without 
,  or  how  he  was 
lars.  They  bore 
convertible  into 
I ;  they  were  not 
The  only  point 
conform  to  the 
ure  was,  that  in- 
ollars  "  pure  and 
I  milled  dollars  " 
)  exceeded  a  cer- 
>roce8s  of  depre- 
antinued  slowly, 
the  whole  Revo- 
1  in  the  value  of 
:er  and  larger  is- 
dred  millions  of 
I  all  hope  of  re- 
light have  been 
war  closed,  and 


THK  LES0OXS  OF  HISTORY. 


87 


the  power  which  issued  it  became  a  recog- 
nized independent  nation,  its  value  would 
increase ;  but  such  was  not  the  case.  In- 
stead of  increasing,  it  became  so  completely 
worthless  that  it  no  longer  served  the  pur- 
pose even  of  money,  but  had  to  be  com- 
pletely thrown  aside,  and  replaced  by  silver 
coin  and  issues  based  upon  coin. 

The  worst  feature  of  this  issue  was  not, 
however,  its  depreciation,  nor  its  final  dis- 
appearance from  commerce;  but  the  pre- 
mium which  it  offered  to  speculators  who 
foresaw  what  was  coming.    Keen -sighted 
men,  knowing  the  result  of  this  continual 
issue  of  paper  money,  saw  very  well  that 
the  prices  of  all  commodities,  especially 
those  which  were  necessary  to  carry  on 
military  operations,  would  inevitably  rise. 
Accordingly,  it  became  good  policy  for 
these  men  to  invest  all  the  money  they 
could  earn  or  borrow  in  food  and  clothing, 
and  to  hold  on  to  this  food  and  clothing 
until  the  price  should  rise.    For  instance, 
suppose  that  flour  was  now  ten  dolUrs  a 
barrel.    A  man  borrows  a  thousand  dollars 
from  his  patriotic  neighbor,  and  with  it 


I 


« 


:0 


m 


THE  ABO  OF  FINAMCE. 


buys  a  hundred  barrels  of  flour.  He  keeps 
this  flour  n  year,  and  the  price  having  dou- 
bled in  the  mean  while,  or,  to  speak  more 
exactly,  the  dollars  he  has  to  pay  being  only 
worth  half  as  much  as  they  were  when  ho 
borrowed  them,  ho  can  sell  out  half  of  his 
flour  for  money  enough  to  pay  his  whole 
debt,  and  can  keep  the  other  half  as  a  clear 
profit  on  the  operation.  Wo  had  an  expe- 
rience very  similar  to  this  in  the  earlier 
years  of  our  Civil  War,  when  gold  specu- 
lators, foreseeing  the  depreciation  of  the 
Government  currency,  made  their  fortunes 
by  buying  gold  on  time.  Returning  to  the 
Revolutionary  period,  many  of  my  readers 
may  remember  the  complaint  of  Washing- 
ton of  the  great  injury  done  the  country  by 
the  "  forestallers,"  as  these  speculators  were 
called,  and  his  wish  that  they  could  all  be 
hanged.  Such  complaints  were  very  nat- 
ural, but  they  were  simply  complaints  of 
what,  taking  human  nature  as  it  is,  wero 
the  inevitable  results  of  the  financial  policy 
pursued  by  the  Government. 

When  the  Constitution  of  the  United 
States  was  framed,  the  members  of  the 


NAMCE. 


TIIK  LESSONS  OF  IIISTURY. 


flour.  He  keeps 
irice  having  dou- 
r,  to  speak  more 
to  pay  being  only 
ey  were  when  ho 
11  out  half  of  his 

0  pay  his  whole 
ler  half  as  a  clear 
iV^o  had  an  expe- 
ls in  the  earlier 
■hen  gold  specu- 
rcciation  of  the 
de  their  fortunes 
Returning  to  the 
>y  of  my  rrsaders 
lint  of  Washing- 
le  the  country  by 
speculators  were 
hey  could  all  be 
s  were  very  nat- 
y  complaints  of 
ire  as  it  is,  were 
e  financial  policy 
it. 

1  of  the  United 
members  of  the 


Convention  met  together  with  the  expe- 
rience of  more  than  a  century  of  paper 
money  weighing  upon  their  minds.  They 
saw  iununicrable  evils  without  any  good 
to  counterbalance  them.  Every  argument 
for  the  alluring  cause  of  the  evil  hod  been 
refuted  hy  the  bitter  test  of  experience. 
They  ii  .1  ^lit  that  one  of  the  greatest 
boons  till  "lid  bestow  ujion  their  pos- 
terity would  hut  of  making  this  crying 
source  of  evil  impossible.     Ac- 

cordingly, ii.  .,  introduced  a  provision  ab- 
solutely prohibiting  the  States  from  ever 
issuing  bills  of  credit.  As  no  power  to 
issue  such  bills  was  given  to  the  United 
States,  they  no  doubt  supposed  that  in 
doing  this  they  had  forever  relieved  the 
country  from  the  greatest  source  of  finan- 
cial trouble  with  which  it  had  ever  been 
afflicted.  This  provision  of  the  Constitu- 
tion was  deemed  so  important  by  Judge 
Story  that  we  shall  quote  his  words,  and 
those  of  the  FederalUt,  to  show  the  views 
of  the  subject  taken  by  those  who  spoke 
more  directly  from  experience  than  we  do : 
"  The  prohibition  to  emit  bills  of  credit 


-d 


00 


TBK  ABC  OF  FIXAMCE. 


cannot,  perhaps,  bo  more  forcibly  Tindi- 
catcd  than  by  quotin,^  the  glowing  lan- 
guage o(  the  FederalUt,  .i  \^ngaai;r  juati- 
iied  by  that  of  almost  e,  '  >i.te^|>oiary 
writer,  and  attested  in  its  'Tutli  by  <  iots 
trom  which  the  mind  almost  invclfntarlly 
turns  away  at  once  with  disgubj  und  in- 
dignation. 'This  prohibition,'  says  the 
FederalUt, '  must  give  pleasure  to  every  cit- 
isen  in  proportion  to  his  love  of  justice 
and  his  knowl(;iije  of  the  true  springs  of 
public  prosperity.  The  loss  which  Amer- 
ica has  sustained  since  the  peace  from  the 
pestilent  effects  of  pcp'i'  money  on  the  nec- 
essary confidence  betwrci.  man  and  man, 
on  the  necessary  confid<">.':>^  in  the  public 
councils,  on  th(t  industry  nud  morals  of 
the  people,  and  on  the  character  of  repub- 
lican government,  constitutes  an  enormous 
debt  against  the  States  chargeable  with 
this  unadvised  measure  which  must  long 
remain  unsatisfied,  or,  rather,  an  accumu- 
lation of  guilt  which  can  be  expiated  no 
otherwise  than  by  a  voluntary  sacrifice  on 
the  altar  of  justice  of  the  power  which  has 
been  the  instrument  of  it.' 


StAMCE. 

J  forcibly  vindi- 
!lie  glowing  lan- 
k  lnngua£,T  Justi- 
^r,  Miitemivjiary 
t&  trutli  by  !.'u:t» 
lost  invclt'.ntorily 
cUsguKl  und  iti- 
l)ition,'  Bays  the 
sure  to  every  cit- 
s  love  of  justice 
3  true  springs  of 
088  which  Amer- 
le  peace  from  the 
iioney  on  the  nec- 
a  man  and  man, 
;>:o  in  the  public 
f  HUd  morals  of 
laracter  of  repub- 
ates  an  enormous 
chargeable  with 
which  must  long 
ther,  an  accamu- 
1  be  expiated  no 
ntary  sacrifice  on 
power  which  baa 


,' .  -^  / 


.immgmmmttm 


IMAGE  EVALUATION 
TEST  TARGET  (MT-3) 


FhotogFaphk) 

Sdenoes 

Corporalion 


CIHM/ICMH 

Microfiche 

Series. 


CIHM/ICMH 
Collection  de 
m 


Jg: 


Canadian  Instituta  for  Hiatorical  Microraproductions  /  Inatitut  Canadian  da  microraproductiona  liiatoriquaa 


:^h^^ 


THE  LK880MS  OF  BISTORT. 


91 


^    F 


"  It  was  the  object  of  the  prohibition  to 
cut  up  the  whole  mischief  by  the  roots, 
because  it  had  been  deeply  felt  through- 
out all  the  States,  and  had  deeply  affected 
the  prosperity  of  all." 

So  great  a  reform  as  the  prohibition  of 
irredeemable  paper  could  not,  however,  be 
inaugurated  all  at  once,  any  more  than  a 
country  could  become  civilized  in  a  single 
generation.  The  evil  which  it  was  sought 
to  blot  out  forever  has  always  reappeared 
from  time  to  time,  in  a  milder  form,  it  is 
true,  but  one  which  is  ctill  an  evil,  namely, 
over-issues  of  bank-notes. 

The  story  of  our  bank-notes  is  very  much 
of  the  same  general  nature  with  that  of  our 
colonial  money,  only  not  so  bad.  In  times 
when  business  is  brisk,  when  everybody  is 
happy,  and  when  speculation  is  rife,  the 
banks  would  issue  paper,  and  discount  the 
notes  of  merchants  to  an  unusual  extent 
What  little  specie  there  was  in  the  coun- 
try would  then,  in  great  part,  leave  it ;  and 
after  a  while  the  inevitable  crash  would 
come.  The  banks  would  be  compelled  at 
the  same  time  to  suspend  specie  payments, 


93 


TIIE  ADC  OF  FINANCE. 


and  to  contract  their  issues.  Speculators 
would  be  unable  to  meet  their  engage- 
ments, and  a  general  fall  of  prices  would 
result,  accompanied  with  great  distress 
among  the  laboring  classes.  The  most 
notable  case  of  this,  a  case  which  every 
one  of  my  readers  either  remembers  or  has 
heard  of,  is  that  of  the  great  crash  of  1887. 
We  are  just  finishing  up  a  similar  experi- 
ence at  the  present  time.  The  enormous 
issue  of  paper  money  by  our  Qovemment 
and  our  national  banks  during  the  Civil 
War  is  now  followed  by  precisely  the  same 
consequences  which  have  followed  every 
previous  issue  recorded  in  history. 

In  our  own  case,  it  is  remarkable  that 
the  depression  and  crash  have  come  be- 
fore the  withdrawal  of  the  paper  money. 
We  have  still  in  circulation  nearly  all  the 
greenbacks  and  all  the  national-bank  notes 
ever  authorized ;  and  yet  the  general  dis- 
tress and  depression  of  business  could  not 
have  been  greater  if  they  had  all  been  ab- 
solutely withdrawn  from  circulation,  and 
people  had  been  left  to  get  a  new  curren- 
cy as  best  they  could. 


*  I 


FINANCE. 

isues.  Speculators 
icet  their  cngage- 
11  of  prices  would 
th  great  distress 
asses.  The  most 
case  which  every 
remembers  or  has 
reat  crash  of  1887. 
)  a  similar  experi- 
le.  The  enormous 
y  our  Qovermnent 
I  during  the  Civil 
precisely  the  same 
ve  followed  every 
in  history. 
is  remarkable  that 
sh  have  come  be- 
the  paper  money, 
tion  nearly  all  the 
lational-bank  notes 
st  the  general  dis- 
business  could  not 
!y  had  all  been  ab- 
m  circulation,  and 
get  a  new  corren- 


TUE  LESSONS  OV  UISTOBY. 


93 


The  French,  during  the  earlier  years  of 
their  Revolution,  had  an  experience  not 
dissimilar  to  our  own.  The  national  ex- 
penses were  so  much  in  excess  of  the  rev- 
enues of  that  nation,  that  it  was  determined 
to  issue  bills  of  credit  known  as  assignats. 
These  bills  bore  a  greater  resemblance  to 
some  of  our  earlier  legal-tender  notes  than 
any  other  system  of  paper  money  with 
which  I  am  acquainted.  Not  only  were 
they  a  legal  tender,  but  they  were  declared 
to  be  redeemable  in  land ;  each  note  bear- 
ing a  certain  daily  interest,  and  entitling 
the  holder  to  confiscated  lots  equal  in  value 
to  the  face  of  the  note,  just  as  our  early 
notes  entitled  the  holders  to  certain  United 
States  bonds.  At  first  the  new  scheme 
worked  well,  as  such  schemes  always  do. 
The  people  were  delighted  to  be  freed  from 
the  visits  of  the  tax-gatherer.  The  as- 
signats paid  off  the  public  creditors,  poi^ 
chased  army  supplies,  and  kept  the  Ctov- 
emment  going.  They  furnished  the  people 
with  money,  the  great  national  want  Very 
soon,  however,  the  other  side  of  the  picture 
began  to  be  seen.   All  the  necessaries  of  life 


liimmm"!!^  •n^^.m 


^ 


94 


TOE  ABC  or  FINANCE. 


gradually  rose  ia  price.  There  was  an  al- 
most total  stoppage  of  productive  industry, 
everybody  trying  to  make  money  in  any 
other  way  than  by  regular  work.  The 
Convention,  backed  by  the  mob  and  by  the 
guillotine,  vainly  endeavored  to  fix  a  maxi- 
mum of  prices.  Bakers  who  refused  to  sell 
their  loaves  at  the  old  prices  had  their 
heads  cut  off  and  carried  through  the  streets 
on  poles  by  the  mob;  but  the  only  result 
was  to  make  bread  still  more  scarce  by 
frightening  the  bakers  from  their  work. 

So  great  did  the  evil  become,  that  in 
the  year  1796,  in  the  very  midst  of  the  first 
Italian  campaign,  when  the  twenty  years' 
struggle  of  France  with  the  other  European 
powers  was  but  just  fairly  begun,  the  paper 
money  had  to  be  entirely  withdrawn  and 
its  place  filled  by  coin.  If  our  theories  of 
the  necessity  of  paper  money  are  correct, 
this  down&U  of  the  circulating  medium 
must  have  been  disastrous  in  the  extreme. 
But  so  far  was  this  from  being  the  esse, 
that  productive  industry  rapidly  recovered 
from  the  depression  of  the  paper  money. 
Men  raised  grain  and  made  bread  in  the 


FINANCE. 

There  was  an  al- 
roductivc  industry, 
kke  money  in  any 
^lar  work.  The 
he  mob  and  by  the 
ored  to  fix  a  maxi- 
who  refused  to  sell 
[  prices  had  their 
through  the  streets 
rat  the  only  result 
11  more  scarce  by 
rom  their  work, 
il  become,  that  in 
y  midst  of  the  first 

the  twenty  years' 
the  other  European 
ly  begun,  the  paper 
ily  withdrawn  and 

If  our  theories  of 
money  are  correct, 
irculating  medium 
>us  in  the  extreme, 
im  being  the  esse, 
f  rapidly  recovered 

the  paper  money, 
made  bread  in  the 


THB  PUBUO  FAITH. 


05 


full  confidence  that  no  mob  would  punish 
them  for  their  pains  by  compelling  them  to 
part  with  it  for  worthless  rags.  The  war 
was  continued  nineteen  years  without  any 
attempt  to  issue  more  paper  money;  and 
in  the  only  instance  since  that  time  in 
which  irredeemable  bilU  have  been  allow- 
ed to  circulate  in  France,  their  amount  was 
carefully  limited  so  as  to  be  insufficient  for 
the  purposes  of  currency,  and  thus  necessi- 
tate the  circulation  of  more  or  less  specie. 


LESSON  xin. 

THE  PUBLIC  FAITH. 

«  Mobs  greenbacks,"  "  The  dollar  of  oar 
fathers,"  and  "The  repeal  of  the  Resumption 
Act,"  are,  at  the  present  time,  three  loud 
cries,  which  we  hear  on  all  sides.  WItst 
is  meant  by  the  second  cry,  however,  is  not 
really  the  dollar  of  our  &ther8,  but  a  cer- 
tain silver  dollar  wliich  for  forty  yean  has 
been  unknown  in  commerce.  The  advo- 
cates of  this  dollar  claim  that  the  repeal 


8Wa^'«.»kJ/.'-'3af.W,r.,Vt^SF^-.:<T??sgS7ysr,-.',iij(»»fcj^^i^^ 


r 


U6 


TUB  ABC  OF  FINANCK. 


of  the  law  making  it  a  legal  tender  in  the 
year  1873  was  a  great  wrong.  In  making 
this  claim,  they  tacitly  assume  that  the  dol- 
lar was  in  use  previous  to  that  time,  and 
that  by  thus  demonetizing  it  a  portion  of 
the  money  power  of  the  country  was  with- 
drawn. In  fact,  however,  for  the  last  two 
generations  the  gold  dollar  has  been  cheap- 
er than  the  silver  one;  bo  that  the  latter 
was  not  really  in  use  at  all.  '^The  act  com- 
plained of  was  nothing  more  than  the  ac- 
ceptance of  a  fiixed  fact,  the  fact  that  the 
silver  doUor  had  gone  out  of  use!'  Not 
one  word  of  this  cry  would  ever  have  been 
heard  had  it  not  been  for  the  recent  im- 
mense fall  in  the  price  of  silver.  Tae  very 
fact  that  the  dollar  has  been  unknown  in 
commerce  for  more  than  forty  years  is  it- 
self one  of  the  strongest  possible  reasons 
against  reviving  it.  Another  strong  rea- 
son is,  that  to  revive  it  would  be  simply 
taking  the  cast-off  money  of  Germany  to 
use  ourselves.  But  the  strongest  reason  of 
all  is  found  in  the  fact  that  gold  is  im- 
mensely better,  and  more  convenient  ma- 
teria? for  making  money  in  largo  waoB, 


:nance. 

gal  tender  in  the 
rong.  In  making 
lumo  that  the  dol- 
to  that  time,  and 
ig  it  a  portion  of 
country  was  with- 
•,  for  the  last  two 
ir  has  been  cheap- 
so  that  the  latter 
11.  ''The  act  com- 
more  than  the  ac- 

the  fact  that  tho 
out  of  use!  Not 
Id  ever  have  been 
or  the  recent  im- 
'  silver,  Tae  very 
been  unknown  in 
I  forty  years  is  it- 
t  possible  reasons 
lother  strong  rea> 

would  be  simply 
ey  of  Germany  to 
trongest  reason  of 

that  gold  is  im- 
re  convenient  ma- 
ey  in  large  famfl, 


THE  PUBUC  VAITH. 


07 


than  silver  is.  Of  course,  for  all  small  pay- 
ments silver  has  been  used,  and  will  con- 
tinue, to.be  used;  but  when  we  come  to 
payments  involving  thousands  of  dollars, 
the. silver  is  entirely  too  cumbrous  to  be 
conveniently  handled,  and  is,  besides,  less 
durable  than  gold.  The  superiority  of 
gold  is  so  obvious  that  the  only  real  reason 
for  favoring  the  silver  dollar  is,  firstly,  that 
it  is  now  the  cheapest  one ;  and,  secondly, 
that. its  introduction  would  tend  to  make 
specie  payments  more  difficult.  In  the  sec- 
ond reason,  tho  whole  question  which  we 
are  considering  is  involved.  We  shall 
therefore  not  consider  it  at  present..  Re- 
specting tho  first,  we  shall  only  say  that  a 
cheap  dollar  merely  means  a  dollar  which 
will  not  buy  you  so  much  food  and  cloth- 
ing. When  the  men  who  live  by  wages 
once  fhlly^derstand  that  this  is  the  rea- 
son why  the  silver  dollar  is  recommended 
to  them  rather  than  the  gold  one,  very  lit- 
tle further  argument  will  be  necessary. 

The  issue  of  greenbacks,  and  cheap 
money  generally,  is  frequently  supported 
on  the  ground  that  we  shall  thus  have  an 
7' 


vis^mmami 


08 


TBS  ABC  OV  FINANCB. 


iDBtrutnont  with  which  to  discharge  dcbta^ 
and  that  tho  more  plentiful  this  instrument, 
the  more  readily  will  the  debts  bo  dis- 
charged. "Those  who  think  thus  seem  to 
think  paying  a  debt  is  a  mere  matter  of 
form  which  a  person  has  to  go  through^ 
and  there  is  an  end  to  iV   If  wo  look  at  it 
a  little  closer,  we  shall  see  that  the  pay- 
ment of  a  debt  is  the  f\ilfilment  of  a  con- 
tract in  which  we  are  to  bo  guided,  not  by 
any  mere  form,  but  by  the  intent  and  mean- 
ing of  the  contract  itself.     The  fact  that 
OAp  person  may  have  made  a  bad  bargain^ 
and  may  suffer  by  having  to  fulfil  it,  is  no 
reason  whatever  for  annulling  it.    Now,  to 
issue  more  greenbacks  and  new  kinds  of 
dollars,  in  order  to  enable  debtors  more 
easily  to  fulfil  their  promises  to  pay  money 
to  their  creditors,  would  be  as  complete  a 
firaad  as  it  would  to  take  a'%»t  of  corn- 
meal,  pass  a  law  calling  it  first-class  family 
flour,  and  pass  it  off  on  the  consumer  in  Ail- 
filment  of  a  contract  to  sell  him  the  latter 
sort  of  flour.    Every  contract  to  pay  money 
made  during  the  last  eight  years  baa  been 
made  with  the  legal  understanding  that  it 


m^^ 


INAMCK. 


TIIB  PCBUC  VAITH. 


» 


a  discharge  dcbta^ 
ul  this  instrument, 
lie  debts  bo  dis- 
link  thus  seem  to 
a  mere  matter  of 
IB  to  go  throughj 
;    Ifwelookatit 
see  that  the  pay- 
ilfilment  of  a  con- 
be  guided,  not  by 
e  intent  and  mean- 
If.     The  fact  that 
tde  a  bad  bargaini 
ig  to  fulfil  it,  is  no 
ailing  it.    Now,  to 
and  new  kinds  of 
ftblo  debtors  more 
itises  to  pay  money 
1  be  as  complete  ft 
like  a'll^t  of  corn- 
it  first-class  family 
he  consumer  in  Ail- 
sell  him  the  latter 
itract  to  pay  money 
ght  years  baa  been 
derstanding  that  it 


might  have  to  be  paid  in  gold  or  its  equiv- 
alent. 

In  1800,  the  Congress  of  the  United 
States  passed  a  solemn  act  pledging  the 
faith  of  the  Government  to  provide  for  the 
payment  of  its  notes  in  coin.  As  many  of 
my  readers  may  not  have  seen  this  law,  I 
will  here  quote  the  provisions  bearing  on 
legal -tender  notes  from  the  Revised  Stat- 
utes of  the  United  States : 

"The  fuith  of  the  United  States  is  sol- 
emnly pledged  to  the  payment,  in  coin  or 
its  equivalent,  of  all  the  obligations  of  the 
United  States  not  bearing  interest  known 
as  United  States  notes.  ***  The  faith  of 
the  United  States  is  also  solemnly  pledged 
to  make  provisions  at  the  earliest  practica- 
ble period  for  the  redemption  of  the  United 
States  notes  incoia."—RetUedStatHtmtftke 
United  StaQp.795. 

In  pursuance  of  this  solemn  pledge,  Con- 
gress, in  January,  1875,  provided  for  re- 
suming specie  payments  on  January  1st, 
1879.  I  think  I  have  sufficiently  shown 
that  the  highest  interest  of  the  country  in 
.all  ita  departments  demands  this  polioy. 


100 


THE  ABC  or  riNANCI. 


i 


"But,  intcrcBt  nsidc,  the  iolemn  faith  of  the 
Government  is  pledged  to  It,  ond  the  law 
cannot  be  repealed  without  a  mo«t  gross 
breach  of  that  faith  against  which  no 
amount  of  merely  material  advantage  could 
be  plnecd.  Every  man  who  since  that  time 
baa  incurred  a  debt,  haa  Incurred  it  know- 
ing that,  when  it  became  due,  the  paper  In 
which  ho  paid  it  would,  by  the  law  of  the 
land,  be  redeemable  in  goW  coin. 

During  the  interval  relerred  to,  the  rate 
•of  interest  has  been  lower  than  it  ever  was 
befoi«  in  this  country,  owing  to  this  very 
expectation  of  resumption  of  specie  pay- 
ments.   It  is  the  debtor's  own  fault  if  ho 
find  that  he  must  now  pay  more  valuable 
dollars  than  he  expected  to.    If  you  are  a 
debtor,  you  say,  perhaps,  that  you  did  not 
expect  that  specie  payments  really  would 
be  i«sumed  and  the  go\d  dollat  again  come 
into  use.     If  BO,  you  arc  sLnply  pitting 
your  own  interests  against  those  of  socie- 
ty.   Your  position  is  very  much  like  that 
of  one  of  a  large  number  of  persona  who 
have  given  their  promissory  notea  for  s 
•  much  greater  amount  than  value  received, 


»*Ka 


riNANCR. 

olemn  faith  of  the 
to  It,  ond  the  law 
tiout  a  nioMt  gross 
iigainst  which  no 
al  advantage  could 
rho  since  that  time 
I  incurred  it  know- 
0  due,  the  paper  in 
l,by  tlio  law  of  the 
roM  coin. 

^!cvred  to,  the  rate 
rcr  than  it  ever  was 
owing  to  thia  very 
tion  of  specie  pny- 
>r's  own  fault  if  he 
pay  more  valuable 
ed  to.    If  you  are  a 
)8,  that  you  did  not 
rments  really  would 
id  dollar  again  come 
are  siinply  pitting 
linst  those  of  socie- 
very  much  like  that 
iber  of  persona  who 
misBory  notes  for  s 
than  value  received, 


THK  rVBUO  FAITH. 


101 


nndcr  the  impression  that  there  wns  a  fair 
chance  of  their  never  being  collected.  You 
and  I  would  both  be  very  sorry  f<r  those 
who  had  taken  so  heavy  u  risk  on  the 
assumption  that  law  was  not  to  take  its 
course ;  but  that  would  not  bo  any  reason 
for  refusing  payment  of  their  notes. 

To  prevent  a  possible  misapprehension, 
it  must  be  remembered  that  resumption 
docs  not  mean  contraction  of  the  curren- 
cy, and  docs  not  of  necessity  involve  any 
contraction.  All  it  requires  is,  that  Gov- 
ernment shall  stand  ready  to  redeem  the 
promise  printed  on  the  face  of  every  green- 
back, if  the  holder  desires  it :  if  he  does 
not  desire  it,  but  prefers  using  the  note  an 
money,  no  law  will  compel  him  to  exchange 
it  for  gold.  If  the  total  amount  of  curren- 
cy in  circulation  does  not  exceed  the  wants 
of  business,  none  will  be  sent  in  for  redemp- 
tion, and  laere  will  be  no  contraction ;  bnt 
if  there  is  more  than  is  really  necessary, 
then  the  excess  will  be  gradually  sent  in. 
And  we  must  never  forget  that  the  more 
certain  redemption  is  to  be  the  permanent 
policy  of  the  Qovcmment,  the  less  owners 


Htwrti 


r '  jsmmi 


103 


THE  ABC  OF  FINANCE. 


of  currency  will  send  for  redemption.  The 
great  facts  and  principles  of  sound  cur- 
rency can  in  great  part  be  condensed  into 
three  sentences. 

■  1.  The  experience  of  the  whole  human 
race  in  all  ages  shows  that  exchangeable 
value  can  reside  only  in  things  which  men 
desire  to  possess,  and  that,  among  the  vari- 
ous articles  of  desire,  gold  and  silver  are 
those  best  adapted  to  answer  for  use  as 
money— the  former  for  large  payments,  the 
lattelr  for  small  ones. 

9.  Under  no  circumstances  should  any 
paper  tokens  be  allowed  to  circulate  as 
money  except  those  with  which  the  hold- 
er can  obtain  their  face  value  in  gold  and 
rilver  whenever  he  wishes  it. 

8.  So  long  as  the  payment  of  all  paper 
money  in  gold  at  the  pleasure  of  the  hold- 
er is  well  secured,  there  is  no  necessity  of 
placing  a  fixed  limit  upon  its  volume. 


NANCE. 


THB  CAUSE  AND  THE  REMEDY.   103 


redemption.  The 
es  of  sound  cur- 
ie condensed  into 

;he  whole  human 
hat  exchangeable 
liings  which  men 
t,  among  the  vari- 
Id  and  silver  are 
mswer  for  use  as 
rge  payments,  the 

ances  should  any 
d  to  circulate  as 
t  which  the  hold- 
value  in  gold  and 
sit. 

ment  of  all  paper, 
asure  of  the  hold- 
ia  no  necessity  of 
n  its  volume. 


LESSON  XIV. 

TBB  CAUSE  AND  THE  BB1IED7. 

The  Cause. 

That  the  present  state  of  the  labor  of  the 
country  exhibits  some  distressing  features, 
no  one  denies.  No  one  will  refuse  his  as- 
sent to  any  measure  which  will  really  and 
permanently  relieve  it  without  bringing  on 
greater  evils  in  the  future.  If  we  can  form 
some  idea  of  the  causes  of  the  present  state 
of  things,  we  shall  be  better  able  to  judge 
of  the  remedy. 

No  doubt,  one  of  the  principal  causes  is 
to  be  found  in  those  inevitable  fluctriationa 
of  business  and  of  industry  which  have  al- 
ways been  the  common  experience  of  civil- 
ized men.  At  one  time  business  is  brisk; 
every  one  is  employed;  wages  are  high; 
and  men  generally  are  happy.  In  the 
course  of  a  few  years  an  era  of  depression 
sets  in;  capital  ceases  to  make  any  profit; 
wages  are  lowered,  and  laborers  find  them- 
selves suffering  for  want  of  the  necessaries 


104 


THR  ABO  OF  FINANCE. 


of  life.  These  fluctuations,  I  say,  are  sim- 
ply inevitable,  and  there  is  no  remedy 
against  them  except  to  patiently  9ght  them 
through,  in  the  full  consciousness  that  as 
times  have  improved  after  every  such  de- 
pression heretofore,  they  will  improve  in 
the  future. 

But  in  our  own  case  the  depression  is  no 
doubt  aggravated  by  two  other  causes :  the 
first  of  these  is,  we  fought  a  great  war  very 
largely  on  borrowed  money,  and  for  more 
than  ten  years  we  have  been  largely  living 
and  developing  our  resources  by  borrow- 
ing. It  is  estimated  that  a  large  propor- 
tion of  the  public  debt  of  the  countiy  is 
now  held  in  Europe.  Every  bond  that  we 
have  sent  to  Europe  has  been  sent  in  pay- 
ment for  some  service  or  commodity  re- 
ceived from  there  for  us  to  add  to  our  re- 
sources. In  other  words,  we  have  practi- 
cally been  running  in  debt  to  Europe,  and 
living  beyond  our  income  for  a  period  of 
some  fifteen  years.  Now,  this  practice  of 
living  beyond  one*s  income  is  something 
which  must  inevitably  cotne  to  a  stop, 
whether  practised  by  a  nation  or  by  an  in- 


NAKCB. 


THE  CAUSE  AKD  THE  REMEDY. 


105 


18, 1  say,  are  sim- 
a  is  no  remedy 
tiently  Sgbt  tbein 
ciousness  that  as 
ir  every  such  de- 
will  improve  in 

i  depression  is  no 
other  causes:  the 
;  s  great  war  very 
ley,  and  for  more 
een  largely  living 
urces  by  borrow- 
t  a  large  propor- 
of  the  countiy  is 
ery  bond  that  we 
been  sent  in  pay- 
)r  commodity  re- 
to  add  to  our  re- 
9,  we  have  practi- 
bt  to  Bhuope,  and 
le  for  a  period  of 
7,  this  practice  of 
ome  is  something 
Gotae  to  a  stop, 
lation  or  by  an  in- 


i^/^ 


dividual ;  and  it  is  something  the  stoppage 
of  which  is  always  accompanied  by  distress. 
The  second  cause  to  which  I  allude  is 
our  irredeemable  paper  currency.  The  his- 
tory of  paper  money  in  this  and  other  coun- 
tries, when  issued  in  quantities  greater  than 
could  be  redeemed,  exhibits  some  common 
features.  The  first  effect  always  is  to  intro- 
duce an  era  of  seeming  prosperity.  Not- 
withstanding that  it  has  hardly  ever  been 
issued  except  in  times  which  would  other- 
wise be  considered  as  times  of  great  ration- 
al dutress,  such  as  an  exhausting  .war,- it- 
luis  alwavs  produced  an  amount  of  extrava- 
gant expenditure  which  would  otherwise 
be  impossible.  The  blood  seems  to  course 
through  the  veins  of  the  body  politic  at  a 
rate  never  before  known.  It  was  so  in  our 
colonial  times;  it  was  so  in  the  French 
Revolution;  it  was  so  during  our  Revolu- 
tionary War,  and,  to  a  certain  extent,  dur- 
ing and  following  our  Civil  War,  although 
iU  stimulating  effect  was  then  less  felt,  be- 
cfkuse  the  issues  were  not  made  with  the 
tetravagance  which  generally  characterizes 
this  policy.    Still,  there  was  some  such  ef* 


HHHWi 


1 


r 


t06 


THE  ABC  OF  FINANCE. 


feet,  as  xras  seen  in  the  almost  entire  ab- 
sence of  depression  daring  the  period  im- 
mediately following  the  war.  The  depres- 
sion we  might  have  experienced  was  great- 
ly diminished  by  the  constant  export  of  our 
Oovemment  bonds  to  Europe  in  payment 
for  goods.  But  the  depression  must  come, 
sooner  or  later.  l^The  nation  which  indulges 
in  paper  money  acts  exactly  on  the  prin- 
ciple of  the  man  who  indulges  in  drink. 
Fbst,  we  have  stimulation ;  then,  depres- 
rion,  which  the  victim  thinlcs  he  can  over- 
come only  by  more  drinlc.  ^ 
•  Agaiuj  the  policy  of  specie  resumption 
and  the  gradual  appreciation  of  the  cur- 
rency seemingly  increase  the  difficulty,  just 
as  tot&l  abstinence  on  the  part  of  the  man 
who  has  been  long  indulging  in  drink  gives 
great  temporary  distress.  It  is,  no  doubt, 
in  the  combination  of  all  these  causes  that 
we  are  to  look  for  the  source  of  the  de- 
preauon  of  business  at  the  present  time. 

The  Bemedif. 
When  the  caravan  is  pasting  over  the. 
Desert  of  Sahara,  it  is  not  uncommon  for. 


riMANCB. 

almost  entire  ab- 
ing  the  period  im- 
war.  The  depres- 
irienced  was  great- 
Btant  export  of  our 
!urope  in  payment 
ression  must  come, 
ion  which  indulges 
actly  on  the  prin- 
indulgcs  in  drink, 
ion ;  then,  depres- 
tiinks  he  can  oTer- 

specie  resumption 
iation  of  the  cur- 
I  the  difficulty,  just 
le  part  of  the  man 
ging  in  drink  gives 
I.  It  is,  no  doubt, 
il  these  causes  that 
source  of  the  de- 
he  present  time. 

edy. 

I  passing  orer  the. 
not  uncommon  fi>r. 


THE  OAUSB  Ain>  THE  REMEDY. 


107 


Its  thirsty  souls  to  be  deceived  by  the  mi- 
rage.  At  a  few  miles'  distance  they  see 
what  seems  to  be  a  lake  of  clear  water; 
and,  leaving  their  road  to  go  and  quench 
their  thirst,  they  are  led  on  and  on,  only  to 
find  themselves  the  victims  of  the  bitterest 
delusion.  The  remedy  for  the  present  dif- 
ficulties now  mout  strongly  urged  upon  ob 
is  of  this  character.  It  is  to  depreciate 
the  currency,  and  give  up  nil  that  we  have 
gained  in  the  direction  of  specie  payments 
during  the  past  ten  years,  by  issuing  a 
larger  supply  of  greenbacks.  Undoubted- 
ly, such  a  policy  would  for  the  moment 
please  a  large  body  of  the  more  thought- 
less class,  who  would  again  find  themaelves 
receiving  two  or  three,  or  perhaps  ten,  dol- 
lars a  day  for  their  work.  Their  joy  would 
be  very  much  like  that  of  the  men  who 
had  just  left  their  caravan  to  go  in  search 
<^tbe  mirage,  and  who  think  they  see  the 
water  they  are  to  drink  only  a  few  hun- 
dred yards  away.  The  result  would  be 
that  the  laborer  would  soon  find  that  his 
two  or  three  or  ten  dollars  would  buy  bim 
no  more  food  and  clothing  than  wonld  fif- 


will  tljUjilg 


►-*» 


108 


THR  ABO  or  FINANCE. 


ty  cents,  for  which  he  had  before  refliwd 
to  work;  and  he  would  be  then'just  as 
badly  off  as  if  his  wages  liad  in  the  begin- 
ning been  reduced  to  flily  cents  a  day. 
And  then,  as  an  end  must  come  at  lost,  the 
end  of  it  all  would  be  a  depression  much 
jcreater  than  that  which  we  now-  suffer, 
akid  the  consciousness  of  a  dishonored  na- 
tioLal  faith  in  the  bargain,  besides  a  blow 
to  oui'  public  credit  and  our  national  pros- 
perity, from  which  it  would  take  a  whole 
generation  to  recover.  The  true  course 
k  directly  the  opposite.  The  surest  and 
quickest  road  to  general  prosperity  is  to 
be  found  in  immediate  resumption.  The 
difBculties  of  the  present  crisis  are  great- 
ly aggravated  by  the  uncertainty  which 
bangs  over  the  future.  Nobody  is  yet 
quite  certain  that  we  are  really  coming  to 
specie  payments,  and  everybody  is  more  or 
}ess  fearful,  or  some,  perhaps  we  might  say, 
are  more  or  less  hopeful,  that  I)efore  1870 
unlimited  greenbacks  will  be  the  order  of 
the  day.  So  long  as  this  uncertainty  ex- 
ists, it  is  absolutely  impossible  for  the  busi- 
ness of  the  country  to  go  into  operation 


mmmm»Mt0!^ 


■IN* 


fJUXCK. 

d  before  refbaed 

be  then'ju8t  as 
lad  in  the  begin- 
fty  cents  a  day. 

come  at  last,  the 
depression  mnch 

we  now-  suffer, 
a  dishonored  na- 
1,  besides  a  blow 
)ur  national  pros- 
ild  take  a  whole 
The  trne  course 

The  surest  and 

prosperity  is  to 
esumption.    The 

crisis  are  great- 
Qcertainty  which 

Nobody  is  yet 
really  coming  to 
ybody  is  more  or 
ips  we  might  say, 
,  that  l)efore  1879 
I  be  the  order  of 
s  uncertainty  ex- 
sible  for  the  bnsi- 
;o  into  operation 


Tne  CAVSB  AND  THE  REMEDT.        109 

on  a  really  healthy  and  settled  basis.  But 
when  it  is  once  undoubtedly  established 
that  the  only  legal  dollar  is  the  honest 
gold  dollar,  the  dollar  made  of  the  only 
material  which  the  experience  of  all  coun- 
tries,  through  thousands  of  years,  has  shown 
to  be  always  effective,  then  every  one  will 
know  exactly  on  what  basis  he  is  to  go. 
The  laborer  will  then  be  satisfied  with 
wages  which,  compared  with  those  of  the 
last  ten  years,  may  be  low,  because  he  will 
know  that,  when  paid  in  honest  gold,  they 
will  buy  him  more  of  the  necessaries  of  life. 
But  the  millennium  will  not  be  inaugu- 
rated. Progress  is  necessarily  slow  and 
gradual ;  and  no  arrangement  which  can 
possibly  be  made  will  secure  to  people  in 
general  bettor  food  and  clothing,  or  houses, 
than  those  which  on  the  average  they  liave 
enjoyed  during  the  past  twenty  years. 

Meanwhile,  privations  must  be  patient- 
ly borne,  and  the  difficulties  which  beset 
us  must  be  gradually  worked  away.  The 
more  ready  the  laboring  classes  are  to  ac- 
cept the  inevitable  low  wages  of  the  pres- 
ent time,  and  to  work  for  whatever  their 


1 


110 


THE  ABC  OF  VINANCB. 


t' 


employers  are  nble  to  pay  then,  the  more 
quickly  will  better  times  come.  The  in- 
auguration of  strikes  at  the  present  time  i« 
like  bleeding  a  man  who  is  just  beginning 
to  recuperate  from  the  prostrating  effects 
of  sickness. 

Let  us  now  bring  together  the  reasons 
why  the  policy  of  inflating  the  currency  in 
any  way  should  be  condemned,  and  why 
the  policy  of  resumption  should  bo  carried 
out. 

1.  All  experience  shows  that  gold  and 
rilver  form  the  only  stable  basis  for  any 
system  of  currency.  Gold  always  has  been, 
now  is,  and  for  generations  to  come  will 
continue  to  be,  the  standard  of  value  for 
the  whole  world,  no  matter  how  many  pa- 
per dollars  we  may  issue. 

2.  Repeated  laws  of  Congress  have 
pledged  the  national  faith  to  all  credit- 
ors that  its  legal -tender  notes  should  bo 
paid  in  coin ;  and  the  reneal  of  those  laws 
would  be^an  act  of  the^  grossest  national 
dishonor,  having  no  other  result  than  the 
legalized  robbery  of  one  class  of  the  com- 
munity for  the  benefit  of  another  class. 


INANCE. 

ny  them,  the  mora 
>8  come.  The  in- 
the  present  time  h 
D  is  just  beginning 
prostrating  effects 

Ifether  the  reasons 
ng  the  currency  in 
idemned,  and  vhy 
I  should  bo  carried 

iws  that  gold  and 
able  basis  for  any 
Id  always  has  been, 
tions  to  come  will 
ndard  of  value  for 
itter  bow  many  pa- 
e. 

of  Congress  have 
faith  to  all  credit- 
er  notes  should  bo 
repeal  of  those  laws 
e  grossest  national 
her  result  than  the 
e  class  of  the  com* 
>f  another  class. 


W7..*VWW»»*a«lb.W»W»«WtW'  'a*>i» 


L 


BOMB  OlNEnAJ.  TBOvoirrs. 


Ill 


8.  The  only  way  to  permanently  relieve 
ourselves  from  our  present  financial  diffi- 
culties is  to  take  such  measures  that  every 
laborer  in  the  land  shall  receive  his  wages, 
be  they  low  or  high,  in  honest  gold  and 
silver,  or  in  notes  convertible  into  gold. 

4.  By  continued  resumption,  we  shall 
be  saved  from  having  again  to  suffer  the 
evils  of  a  depreciated  currency ;  whereas, 
to  now  take  a  backward  step  would  be  to 
plunge  into  them  again,  and  to  go  once 
more'  through  all  the  difficulties  we  are 
now  encountering. 


LESSON  XV. 

BOMB  OENBRAL  THOCOHT8. 

Tms  question  of  regulating  the  currm- 
cy  is  no  easy  one,  to  be  settled  by  an  off- 
band  opinion  even  of  wise  men,  much  less 
of  men  entirely  ignorant  of  the  history  and 
laws  of  the  subject.  It  perplexes  the  best 
intellects  of  the  world,  and  will  probably 
•continue  to.  do  ao  for  a  long  tipe  to  come. 


113 


THE  ABC  or  FISANCB. 


It  is  io  intricate  that  only  a  mathematical 
head  can  unravel  it— the  •amo  kind  of  a 
head  which  can  «olve  a  tough  problem  in 
algebra,  or  settle  the  accounts  of  the  Tweed 
Ring,  and  tell  just  how  much  money  each 
man  owes.  Neither  fine  writing  nor  ora- 
tory will  afford  the  slightest  help,  any 
more  than  It  will  help  a  man  to  under- 
stand a  steam-engine. 

The  advocates  of  redeemable  money  have 
no  millennium  to  offer.    They  know  that 
the  sentence,  '^In  the  sweat  of  thy  face 
Shalt  thou  eat  bread,**  cannot  be  commutwl 
by  any  human  contrivance ;  that  there  Is 
no  real  value  which  can  be  commanded  by 
nnv  other  agency  than  labor  of  the  haml 
or"  head.     They  perfectly  know  the  diffi- 
culties which  beset  any  system  of  redemp- 
tion of  paper  In  coin,  and  are  as  keenly 
alive  to  them,  and  as  anxious  to  remedy 
them,  as  the  strongest  paper-money  advo- 
cates can  be.     But  they  know  also  that 
to  undertake  to  avoid  these  difficulties  by 
doing  away  with  redemption  in  gold  to 
as  foolish  as  If  the  p-ssengers  In  a  ship, 
finding  that  she  was  tossed  by  the  storm, 


J 


—  liiiiWi 


r  WNANCB. 

only  a  mathematical 
-the  aatne  kind  of  a 
)  a  tough  problem  in 
ccounts  of  the  Tweed 
iw  much  money  each 
Bno  writing  nor  ora- 
slightest  help,  any 
ilp  a  man  to  under- 

ideemable  money  have 
fer. ,  They  know  that 
le  sweat  of  thy  face 
•♦  cannot  be  commuted 
■ivance ;  that  there  is 
can  be  commanded  by 
lan  labor  of  the  hand 
fectly  know  the  diffi- 
iny  Bystem  of  redemp- 
In,  and  are  as  keenly 
as  anxious  to  remedy 
Bst  paper-money  advo- 

they  know  also  that 
•id  these  difficulties  by 
redemption  in  gold  ia 

passengers  in  a  ship, 
18  tossed  by  the  storm, 


_J 


BOMB  OXXBRAL  THOUOHTS. 


113 


frightfully  beaten  by  the  waves,  and  in 
danger  of  destruction,  should  scuttlo  her 
and  take  to  swimming,  for  fear  of  suffer- 
ing shipwreck.  I  think  most  readers  must 
have  a  fnint  suspicion  that  the  wisest  of 
the  human  race  are  opposed  to  irredeema- 
ble paper.  If  you  were  to  take  a  vote  of 
the  political  economists,  the  close  students, 
the  bankers,  the  professors,  and  the  histo- 
rians on  the  subject— in  fine,  of  all  those 
men  who,  either  by  their  knowledge  or 
their  powers  of  investigation,  are  best  fit- 
ted to  understand  the  subject,  the  vote  for 
irredeemable  currency  would  be  astonish- 
ingly small.  If  the  reader  distrusts  hU 
own  judgment,  this  fact  is  worth  think- 
ing of. 

We  can  hardly  conceive  a  scene  of  more 
dramatic  interest  than  that  of  the  people 
of  our  country  preparing  to  decide  wheth- 
er they  will  taste  the  tempting  cup  which 
the  advocates  of  inflation  are  holding  to 
their  lips,  and  accept  the  honeyed  words 
in  which  they  are  told  that  it  contains  the 
magic  elixir  of  life,  which  will  pat  money 
into  every  poor  man's  pocket.  ▲  hundred 
8 


I 


ar^ 


114 


TBI  ABC  or  nMANCK. 


genorationi  of  tho  human  roco  hare  held 
their  breath  as  they  have  heard  or  rend 
tho  »ong  of  the  •Irena  addressed  to  Ulys- 
ses, which  would  havo  allured  him  to  do- 
Btruction  if  he  had  not  filled  the  ears  uf 
his  craw  with  wax : 
•'  Oh  ttajr,  O  pride  of  OrMM,  UlyiMt,  lUy  i 

Oh  CMH«  thjr  eoonw,  snd  llitcn  to  unr  Isy. 

BiMt  ii  th«  Bwn  ordstnad  onr  Tolce  to  hear ; 

The  fODg  iDttraeU  th«  loal  and  cbarmt  the  «Ar. 

Approach  t  thy  aoal  shall  Into  raptarc*  rlic : 

Approach  t  and  learn  new  wlidom  friim  the  wlte. 

We  know  whate'er  the  kings  of  mighty  uaros 

Achieved  at  Illon  In  the  fleld  of  ftune, 

Whate'er  heneath  the  tnn's  bright  Journey  lies. 

Oh  stay,  and  learn  new  wisdom  from  the  wise  I" 

The  drunkard,  holding  the  intoxicating 
cup  to  the  lipa  of  the  innocent  boy,  and 
saying,  "Just  swallow  this,  my  boy,  and 
your  thirst  wMl  be  quenched— you  will 
feel  new  life  in  your  veins,  new  strength 
in  your  limbs,  and  a  happiness  in  your 
spirits  of  which  you  never  dreamed,"  af- 
fords the  moralist  a  scene  on  which  ho 
has  dwelt  ever  since  the  days  of  Solomon. 
The  present  crisis  in  our  national  history 
is  similar  to  that  in  the  life  of  Ulysses 
when  the  tong  of  the  sinna  charmed  his 


I 


nilANCI. 

nan  roco  liaTe  hold 
lave  heard  or  rend 
addressed  to  Ulys- 
I  allured  him  to  do- 
)t  filled  the  ears  uf 

•,  UljrtMt,  (Uy  I 
lltUin  to  unr  Uy. 
I  oar  Tolce  to  hear ; 
lOl  and  cbarmi  tb«  cnr. 
I  Into  rspturct  rlie ; 
r  wMom  frum  th«  wIm. 
iDgt  of  migbtjr  u«m« 
laid  of  dune, 
n't  bright  Jonmer  11m- 
rtsdom  from  the  wIm  I" 

Dg  the  intoxicating 

0  innocent  boy,  and 
r  this,  my  boy,  and 
luenched — you  will 

Tcins,  new  strength 
i  happiness  in  your 

never  dreamed,"  af- 

scene  on  which  ho 
the  days  of  Solomon. 

our  national  history 

1  the  life  of  Ulysses 
ie  aiiena  charmed  his 


HOMK  QESKBAt  THOUOHTS. 


115 


soul,  or  in  tlio  life  of  the  boy  wlifln  he  has 
to  decide  whether  ho  will  titBto  the  cup. 
The  promUcs  ore  as  fair  as  those  of  the 
sirens,  the  words  as  tetfiptlng  as  those  of 
the  drunkard ;  the  result,  a  disastor  to  our 
natlonol  prosperity  from  which  It  would 
take  long,  long  years  to  recover. 


THR  RVD. 


mmt 


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Hagh  Melton. 

IllDitrated.    8vo,  Paper,  26  cent*. 
Forciblr  prwenU  •omo  of  the  bMt  polnU  of  Brlttah 
character !  Ttt  loftj  icorn  ofmMapMt,  iu  »nt«iie  coii- 
tSnpt  for  llMi  una  tWe»M,  lU  high  regard  for  truth 
and  hoDMty.— CJkriiMem  Adtoaatt,  N.T. 

Off  the  Boll. 

8vo,  Paper,  60  centB. 
A  capJUlly  drawn  picture  of  Canadian  Hfc,  w>th  an 
JneeSonrty  conceived  and  not  Impoaalble  plot,  and 
nawral.  healthy  men  and  women  tor  actors,  aTolding 
SStte  one  hand  the  Scylla  of  .enMtlonalltm,  and  ou 
the  other  the  Charybdla  of  mawWeh  aentlmentaUty.- 
X.r. World.  

Our  Detaohment. 

8vo,  Paper,  86  centi. 
A  BparWlnB  novel,  firee  from  the  •lightest  taint  of 
dniinML  nnf  remarkable  for  the  'PfftSd  manner  lii 
which  the  converaallona  are  malnulned^nd  the  ex- 
Mllent  attempte  at  charaeter^rawtng.  *J«  «»*"L^ 
eanally  at  home  In  pathoe  and  In  hnmpr.  and  occa- 
STonalfy  hreata  torih^ln  good -humored  bnt  temng 
aaUre.  The  plot  Is  well  eoetalned  jnoortittljMlly 
Seated,  and  haa  the  fhrther  merit  of  being  neither 
forced  nor  SnnaturaL-flW.  Svening  OM«tte,"bo«tou. 


FablldMd  by  HABPEBABBOTHIBS,  New  Toik. 

tr  H  Aum  A  BiOTBSiatvai  ind  tOher  ^^OusattM 
,t^b^/^poMgti«rtpatd,toamP«rt<^theUnm 
StaUt  or  Canada,  on  reeflpt  v  tMprte$. 


Dufs  Novels. 


,  Paper,  25  ceiiti. 
>f  the  bMt  polnto  of  Britbh 
if  m«MiiMH,  iu  Interne  coii- 
■,  lu  high  regard  for  tratb 


ents. 

re  of  CM«di«a  life,  with  »n 
d  not  impoeeible  plot,  and 
women  for  actort,  avotdiDg 
la  of  WDiatlonatltm,  and  ou 
f  mawkUh  aentimcDtaUty.— 


«nti. 

from  the  fllghteet  taint  of 
for  the  fpirited  manner  in 
are  malnUlned,  and  the  ex- 
Bter-drawtnp.  The  author  U 
loe  and  In  hnmor,  and  occa- 
cood- humored  but  telling 
II  fuetained  and  artlattcally 
ther  merit  of  being  neither 
at  Svenlng  Gfatrtte,  Bostou. 


*  BB0THBB8,  Kew  Toik. 

jiaii,tottniipt»rt<tfthelTn1m 
pt^thipriei. 


Ro  library,  howevtr  modeiiti  ihoaM  be  wlthoot 
tUa  work  of  reference*— iV.  Y.  World. 

HAYDN'S 

DICTIOIIRY  OF  OmS. 

HAYDN'S  DICTIONARY  OF  DATES,  re- 
lating to  all  Ages  and  Nationi.  For  Univere- 
al  Reference.  Edited  by  Bbnjamih  Vinobiit, 
Assistant  Secretaiy  and  Keeper  of  the  Library 
of  the  Royal  Institution  of  Great  Britain ;  and 
Revised  fur  the  Use  of  American  Readere. 
8vo,  Cloth,  (3  00 ;  Sheep,  $8  87. 

There  it  nothing  omitted  that  can  UWj  be  looked 
fur  In  inch  a  workt  and  the  reader  would  verj  much 
mistake  lu  character  were  be  to  Infer,  as  he  might 
from  Its  title,  that  It  Is  nothing  hot  a  dlcUonary  of 
dates ;  for,  while  It  Is  such  a  dlotlonarr.  It  Is  something 
more,  and  a  close  student  of  It  might  pass  himself  off 
for  a  well-read  men,  were  his  memory  good,  and  were 
he  wllllDg  to  practice  deceit  It  la  welKnIgh  an  ex- 
banstWe  work  in  respect  to  Ita  Immediate  pnrpoae^ 
Beibm  TnutlUr. 


FDDUsinm  nx  BABPEK  *  BB0THEB8,  ITaw  Tons. 

^  BABPn  *  Baoraaaa  wiB  send  th»  atow  werl!  by 
nwU.  to  any  part  Mfth»  tnrittd  SfalM  or  Oniado,  on  r*- 
««?^'<vr  M«  jlriee,  md  on*  sisM  aMMmU  to  oomt  aost 


HABPEB'S 

Household  Dicliens  Complete. 

Elogmt  and  Cheap.  8vo.  With  Original  lUiu- 
tratlons  by  Thos.  Nast,  J.  Barnard,  E.  A.  Ab- 
bey,  A.  B.  Froet,  J.  Mahoney,  0.  S.  Reinhart,  and 
other  eminent  American  and  Engllah  Arttott. 

Oliver Twjtat...... }  CToth,$100jP»p«r,B0ceati. 

^?01d"curC»?8hip.!.aotl..tt  »,  P.p.r.TOc.»tfc 


DsTld  Copperfleld. 
Uomber  and  Bon.. 
Nicholas  NtcUeby. 

Bleak  House 

Pickwick  Paper*.. 
Martin  Chuxilewit 

Uttle  Dorrit 

Bamaby  Rndee 
-     —       •Prle 


;1 


Clotb,  It  60 ;  Paper,  $10a 


Oar  M  ntnal  Friend 

Christmas  Stories 

Great  Expectation*. .... 
The  Uncommercial  Trav- 

e11er,Uard  Times,  and 

The  Mystery  ofEdwtu 

Drood. •.■".■• 

Pictures     from    Italy, 

Sketches  by  Bos,  and 

American  notes 

The  Set  CoMpIeto,  U  Tola.,  Clotb,  ta  neat  hex,  tM. 

ly  HABPn  *  Bwyrasia  ttitt  rnni  ttther  <\f  ths 
otoM  tsorfcs  hy  moO,  pottagtpnpaO,  to  anf/parto/thf 
ritUid  StatM  or  Canada,  <mrto»^<tfth$  priet. 


PER'S 

ikens  Complete. 

vo.  With  Origliml  IU«u- 
ist,  J.  Barnard,  E.  A.  Ab- 
ihonej,  C.  S.  Reinhart,  and 
lean  and  English  Artiats. 

1  aoth,$100jPap«r,B0cetiti. 
!  .aotbitl  SB ;  Paper,  IB  MDts. 


'  Clotb,  It  BO :  Paper,  $1  oa 


oil.,  Clotk,  la  neat  bos,  f  tt. 


nsis  ttitt  imi  ttthtr  <\f  1h» 
tag»pnptM,U>mi/part(tfth* 


Macaulay'8  Life^and  Letters. 

The  Life  and  Letters  of  Lord  Macaulay.  Bj  hit 
Nephew,  O.  Otto  Tutiltaii,  M.P.  With  Por- 
trait.  2  vols.,  8vo,  Cloth,  uncut  edges  and  gilt 
tops,  10  00;  Sheep,  $6  00;  Half  Calf,  |9  BO. 
Popular  Edition,  1  vol.,  12mo,  Cloth,  tl  75. 

The  blographv  Is  In  every  respect  worthy  of  the 
sableet.  Sir.  l^velynn  bus  executed  bis  ta»k  with 
most  praiseworthy  modesty  and  sood  taste,  aud  with 
gnat  literary  sitlll.  •  *  •  Jlacanliifs  Life  furnis  a  most 
rnterastlnff  book,  living  as  he  did  In  the  thick  of  ^ 
literary  and  political  activity  of  bis  time.  It  afford} 
US  maoy  firmb  ptetnres  of  incldenU  In  which  be  playod 
a  part,  and  amnslng  sad  lostrnctlve  anecdotm  of  th« 
celebrities  with  whom  be  came  In  contact,  and,  above 
all,  it  throws  a  great  deal  of  unexpected  IlL'ht  on  bia 
own  personal  character.  •••  Nothing  could  surpass 
the  charm  of  those  portions  of  the  biography  In  which 
Mr.  Trevelyan  pictures  Macaulay  at  borne,  from  the 
time. when,  already  a  man  In  learning,  be  romaaeed 
with  his  playmates  on  Clapham  Common,  to  the  tiiM 
when,  still  a  boy  In  Hnlmalsplrits,  he  wrote  to  his  sis* 
ter^  from  the  smoking-room  of  the  House- of  Com; 
mons,  exnberanUy  livery  and  brilliant  deseripUpna  of 
the  great  Reform  debates,  or  spent  evenings  with  them 
In  Great  Ormund  Street,  punning,  redtlng,  and  Mp* 
ping  verses,  In  the  Intervals  between  his  aitoniabing 
the  House  with  displays  of  oratory  which  exeelM 
every  thing  heard  "since  Plunketi"' or,  later  aUII. 
when,  In  the  intervals  of  composing  his  history,  ha 
took  bis  nephews  and  niecea  with  him  on  holiday 
titan,  and  kept  them  In  flu  of  laughter  with  puna, 
rhymes,  and  tales,  firom  one  end  of  a  railway  Jonmey 
to  the  other.— ietam<n«r,  London. 

Published  by  HABPER  fc  BBOTHERS,  New  lotk, 

rmiU,  to  my  fw«  y  «b  TniM  AM  OT  Chm^  m  n«<fi  5r  M« 


MACAULAY'8 

History  ^England. 

The  Hi«tonr  of  England  from  the  Acceaiion  of 
James  II.  By  Lord  Haoaclat.  In  FUre  Vol- 
umes.   With  elaborate  Index. 

LiBRART  EDmoM:  6  vols.,  8vo,  Cloth,  $10  00; 

Sheep,  tia  BO ;  Half  Calf,  tSl  80- 
FonrLiB  EDtnoM :  B  toIs.,  ISmo,  Cloth,  |4  00; 

Sheep,  16  00 ;  Half  Calf,  $13  76. 
Chkap  EDmoM:  B  toIs.,  8vo,  Paper,  fl  60. 

The  Tolumea  are  sold  separatel.T. 

With  the  Wit  of  the  world  we  come  with  onr  hom- 
■M  to  MMsnlar.  Thefa  U  no  nccaduu  tor  n»  to  qoote 
from  lliicaala]!,  to  eritlclie.or  t«  praise  him.  Our 
readers  long  ago  hare  made  their  own  qttotaUoni, 
■elected  their  fiitrorlte  passages,  have  read  again  ana 
SSnevery  psge  of  hTThlftory;  and  the  nnWersal 
•probation  of  the  world  has  at  once  dispensed  with 
Se  neuesslty  of  panegyric,  and  made  censure  Jmpps- 
Sble.  excepl  to  thoee  who  are  •«W"«««?5  •/?»'?? 
•Ingnlarity.  On  whaterer  side  we  look  at  this  book, 
whetter  thV  style  of  it  or  the  matter  of  It,  It  is  alike 
Mtonlshlng.  The  style  is  fanlUeasly  Inmlnons ;  erenr 
wort  is  In  its  right  plate !  every  ■«>»«>«?,'•  t?'?*: 
■Itely  bulanced ;  the  cnrrent  never  flags.  Homer,  ac- 
eordlng  to  the  Roman  poet  may  he  aometlmes  lan- 
guid,  Ikacanlay  is  always  bright,  sparkling,  attract- 
rve.— ITMtmlnittr  ibsiws. 

Pnbliihed  by  HARPn  k  BBOTHBBS,  HEW  TORI. 
trXMer  of  th*  atess  worts  snU  bu  maOtjpMtaM 


Jl 


ULAY'8 

f  England. 

i  from  the  AcceMion  of 
Haoaclat.  In  FUre  Vol- 
ite  Index. 

vols.,  8vo,  Cloth,  $10  00; 

ilf  Calf,  tSl  80- 

Tols.,  12mo,  Cloth,  $4  00; 

If  CtU,  lis  75. 

)1r.,  8vo,  Paper,  fl  60. 

old  sepantel.T. 

arid  we  come  wtth  onr  bom' 
U  no  nccMlou  for  ni  to  quote 
;lie,  or  t»  pralae  htm.  Onr 
made  their  own  quotation^ 
wMgee,b«Te  read  again  and 
I  hUtorr;  and  the  nnlreraal 
I  has  at  once  dlapenaed  with 
ric,  and  made  eenrare  Imppa- 
ko  aie  •mbltlona  of  a  foollib 
nr  aide  we  look  at  thia  b«ipk, 
It  the  matter  of  It,  it  ia  alike 
afanlUeaslyleminona;  erenr 
MS  every  sentence  la  ezqni- 
rent  never  flaRS.  Homer,  ae- 
MMt  majr  be  sometimes  lan< 
ye  bright,  aparkling,  attract- 

irii0THBR8,REWT0BI. 

w  worts  stiU  bg  wait,  mMtoM 
Ms  rnttMi  jSMss  or  Oanadk, 


Lord  Lytton's  Horace. 

THE  ODES  AND  EPODES  OF  HORACE. 
A  Metrical  TraniUtion  into  English.  With 
iBtiodoction  and  Commentaries.  By  Loko 
IiTTTOii.  VTlth  Latin  Text  from  the  Editions 
oC  Orelli,  Macleane,  and  Yonge.  ISmo, 
Cloth,  (t  76. 

It  asblblta  tbronehont  a  palnstsUng  enddSTor  to 
render  the  graceltal  anng  of  the  Rowan  lyrist  Into 
rhymelese  measorea  with  the  least  nossible  saeriflee  of 
literary  accuracy ;  and  we  think  in  reproducing  that 
•drfoaa/UMtas  ttrbormm  for  which  Horace  is  solnstly 
Cunons,  he  has  ireanently  been  more  suecesslU  than 
any  previona  translators.  *  *  *  The  first  thing  which 
strikes  ns  when  we  compare  the  iranalatad  Odae  with 
the  originals,  is  the  llteralness  and  verbal  accnraev  of 
the  tranalationa J  and  we  notice  with  pleosnre  bow 
freqaently  Lord  tytton  haa  anccessAiUy  Imitated  that 
terseness  which  be  pralsss  so  much  in  toe  Bonan  poet 
«*AV0fnnMr. 

Iiord  Lytton  has  certainly  great  qnallficationa  fbr 
bla  task.  He  baa  poetical  nnina,  be  ia  akilllhl  in  the 
arts  of  versMcation,  and  lew  men  can  write  more 
rhythmical  prose.  At  the  aame  time,  he  Is  a  gennine 
lover  of  tlM  claaaical,  and  haa  eanght  Ita  spirit  with  no 
little  success.  *  *  *  The  transtatloa  is  one  which  every 
lover  of  Horace  may  read  Willi  proflt  We  have  sel- 
dom seen  a  better  illnstratioa  of  the  tmtb  that  a  good 
tnmalation  ia  a  continnoaa  inteipretation.— 4wenl«r. 

yaUiihtdlhTBimB*IIOKHmS,VtwTork. 

IV  HAsm  A  BaoTuoaa  tM  ami  th»  aAov*  wort  fttr 
twefl,pi»iftns  frtpmU,  tt  tmg  pturt  <^tlf  TiUM  AMts 


Ml 


»**      '^^rt^  , 


i 


"  '*' ■  ■^mesK'siimmammmmmaaemmsir' 


\  :  ! 


if;  I;  fit 


i;  '&\ 


m  1 


111 


HARPER'S  PERIODICALS. 

HARPER'S  MAGAZIAji 

That  Harper'*  Magadnt  hu  become  k 
■Utution  and  an  educator  uf  the  people  m' 
of  leaders  know  to^y.— A»*»»  *" 

HARPER'S  WEEKL 

Harpa'*  Wtddy  ehould  be  in  every  f amOj^ 
out  the  land,  as  a  purer,  more  interestinf^  _„ — 
toned,  better-illustrated  paper  is  not  published  in  this 
or  any  other  country.— OwiMiMreio/  JMOeftn,  Boston. 

HARPER'S  BAZAR. 

A  weekly  devoted  to  various  departments  of  Uter< 
ature,  fashion,  and  domestic  arts.  It  is  an  adndrably 
conduced  illustrated  paper,  crati^idng  essays,  edito- 
rials, stories,  and  freneral  information  of  a  superior 
order.— AtwJKyM  J^. 

» 
One  oopy  of  ddwr  will  be  sent  for  one  year,  Msfam 
pmisM  by  the  Publishers,  to  any  Subscriber  In 
&^^ited  fjMm  ^'^W^'^ffj,  ^^  ^  ^*^ 

Emm's  Maoahiii,  HAina's  Wiiklt,  and  HAiMtfB 

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9?  00:  postage  prepud  by  the  Publishers. 

An  EtUn,  «q^v  of  either  the  lUaABn,Yrwna.r, 

or  Baxab  will  be'sent  gratis  for  every  Club  of  Fivx 

SuBsounns  at  $4  00  eaeh,  in  one  remittance;  or, 

Sx  Copies  impH SO,  without  extra  copy:  postage 

prepaM  by Jn^ibUfieis. 

k  BBOtHIBS,    aw  Tow. 


PERIODICALS. 


'5  MAGAZIhn 


ynnnehu  become 
fttor  uf  the  pe(4»le  %< 
yj. — BoiUm 

R'S  WEEKL] 

bould  be  in  every  f amny,^ 
purer,  more  iiitere>tiii|^   _ 
ed  paper  is  not  published  in  thia 
—Conrntraai  BuUelin,  Boston. 

ER'S  BAZAR, 

1  to  various  departments  of  liter< 
tmestiu  arts.  It  is  an  adndrably 
paper,  contididng  essays,  edito> 
neral  information  of  a  superior 
gl». 

m 
rill  be  sent  for  one  year,  oosfam 
tblishers,  to  any  Subscriber  in 
I  (»  0^iils,|g|  reoeipt  of  Four 

Habpir's  Wrklt,  and  HAHMt 
year,  $10  00;  or  any  two  for 
Kvpidd  by  the  Publishers. 
«f  either  the  MASAnin,WnKi.T, 
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lers. 

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1 


